Housing and Economic Recovery Act of 2008
PL 110-289 (H.R.3221), enacted 07/30/2008

122 STAT. 2654 
PUBLIC LAW 110–289—JULY 30, 2008 
Public Law 110–289 
110th Congress 
An Act 
To provide needed housing reform 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; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the ‘‘Housing and 
Economic Recovery Act of 2008’’. 
(b) TABLE OF CONTENT.—The table of contents for this Act 
is as follows: 
Sec. 1. Short title; table of contents. 
DIVISION A—HOUSING FINANCE REFORM 
Sec. 1001. Short title. 
Sec. 1002. Definitions. 
TITLE I—REFORM OF REGULATION OF ENTERPRISES 
Subtitle A—Improvement of Safety and Soundness Supervision 
Sec. 1101. Establishment of the Federal Housing Finance Agency. 
Sec. 1102. Duties and authorities of the Director. 
Sec. 1103. Federal Housing Finance Oversight Board. 
Sec. 1104. Authority to require reports by regulated entities. 
Sec. 1105. Examiners and accountants; authority to contract for reviews of regu-
lated entities; ombudsman. 
Sec. 1106. Assessments. 
Sec. 1107. Regulations and orders. 
Sec. 1108. Prudential management and operations standards. 
Sec. 1109. Review of and authority over enterprise assets and liabilities. 
Sec. 1110. Risk-based capital requirements. 
Sec. 1111. Minimum capital levels. 
Sec. 1112. Registration under the securities laws. 
Sec. 1113. Prohibition and withholding of executive compensation. 
Sec. 1114. Limit on golden parachutes. 
Sec. 1115. Reporting of fraudulent loans. 
Sec. 1116. Inclusion of minorities and women; diversity in Agency workforce. 
Sec. 1117. Temporary authority for purchase of obligations of regulated entities by 
Secretary of Treasury. 
Sec. 1118. Consultation between the Director of the Federal Housing Finance Agen-
cy and the Board of Governors of the Federal Reserve System to ensure 
financial market stability . 
Subtitle B—Improvement of Mission Supervision 
Sec. 1121. Transfer of program approval and housing goal oversight. 
Sec. 1122. Assumption by the Director of certain other HUD responsibilities. 
Sec. 1123. Review of enterprise products. 
Sec. 1124. Conforming loan limits. 
Sec. 1125. Annual housing report. 
Sec. 1126. Public use database. 
Sec. 1127. Reporting of mortgage data. 
Sec. 1128. Revision of housing goals. 
Sec. 1129. Duty to serve underserved markets. 
Sec. 1130. Monitoring and enforcing compliance with housing goals. 
42 USC 4501 
note. 
Housing and 
Economic 
Recovery Act 
of 2008. 
July 30, 2008 
[H.R. 3221] 
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122 STAT. 2655 
PUBLIC LAW 110–289—JULY 30, 2008 
Sec. 1131. Affordable housing programs. 
Sec. 1132. Financial education and counseling. 
Sec. 1133. Transfer and rights of certain HUD employees. 
Subtitle C—Prompt Corrective Action 
Sec. 1141. Critical capital levels. 
Sec. 1142. Capital classifications. 
Sec. 1143. Supervisory actions applicable to undercapitalized regulated entities. 
Sec. 1144. Supervisory actions applicable to significantly undercapitalized regu-
lated entities. 
Sec. 1145. Authority over critically undercapitalized regulated entities. 
Subtitle D—Enforcement Actions 
Sec. 1151. Cease and desist proceedings. 
Sec. 1152. Temporary cease and desist proceedings. 
Sec. 1153. Removal and prohibition authority. 
Sec. 1154. Enforcement and jurisdiction. 
Sec. 1155. Civil money penalties. 
Sec. 1156. Criminal penalty. 
Sec. 1157. Notice after separation from service. 
Sec. 1158. Subpoena authority. 
Subtitle E—General Provisions 
Sec. 1161. Conforming and technical amendments. 
Sec. 1162. Presidentially-appointed directors of enterprises. 
Sec. 1163. Effective date. 
TITLE II—FEDERAL HOME LOAN BANKS 
Sec. 1201. Recognition of distinctions between the enterprises and the Federal 
Home Loan Banks. 
Sec. 1202. Directors. 
Sec. 1203. Definitions. 
Sec. 1204. Agency oversight of Federal Home Loan Banks. 
Sec. 1205. Housing goals. 
Sec. 1206. Community development financial institutions. 
Sec. 1207. Sharing of information among Federal Home Loan Banks. 
Sec. 1208. Exclusion from certain requirements. 
Sec. 1209. Voluntary mergers. 
Sec. 1210. Authority to reduce districts. 
Sec. 1211. Community financial institution members. 
Sec. 1212. Public use database; reports to Congress. 
Sec. 1213. Semiannual reports. 
Sec. 1214. Liquidation or reorganization of a Federal Home Loan Bank. 
Sec. 1215. Study and report to Congress on securitization of acquired member as-
sets. 
Sec. 1216. Technical and conforming amendments. 
Sec. 1217. Study on Federal Home Loan Bank advances. 
Sec. 1218. Federal Home Loan Bank refinancing authority for certain residential 
mortgage loans. 
TITLE III—TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY OF 
OFHEO AND THE FEDERAL HOUSING FINANCE BOARD 
Subtitle A—OFHEO 
Sec. 1301. Abolishment of OFHEO. 
Sec. 1302. Continuation and coordination of certain actions. 
Sec. 1303. Transfer and rights of employees of OFHEO. 
Sec. 1304. Transfer of property and facilities. 
Subtitle B—Federal Housing Finance Board 
Sec. 1311. Abolishment of the Federal Housing Finance Board. 
Sec. 1312. Continuation and coordination of certain actions. 
Sec. 1313. Transfer and rights of employees of the Federal Housing Finance Board. 
Sec. 1314. Transfer of property and facilities. 
TITLE IV—HOPE FOR HOMEOWNERS 
Sec. 1401. Short title. 
Sec. 1402. Establishment of HOPE for Homeowners Program. 
Sec. 1403. Fiduciary duty of servicers of pooled residential mortgage loans. 
Sec. 1404. Revised standards for FHA appraisers. 
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122 STAT. 2656 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE V—S.A.F.E. MORTGAGE LICENSING ACT 
Sec. 1501. Short title. 
Sec. 1502. Purposes and methods for establishing a mortgage licensing system and 
registry. 
Sec. 1503. Definitions. 
Sec. 1504. License or registration required. 
Sec. 1505. State license and registration application and issuance. 
Sec. 1506. Standards for State license renewal. 
Sec. 1507. System of registration administration by Federal agencies. 
Sec. 1508. Secretary of Housing and Urban Development backup authority to es-
tablish a loan originator licensing system. 
Sec. 1509. Backup authority to establish a nationwide mortgage licensing and reg-
istry system. 
Sec. 1510. Fees. 
Sec. 1511. Background checks of loan originators. 
Sec. 1512. Confidentiality of information. 
Sec. 1513. Liability provisions. 
Sec. 1514. Enforcement under HUD backup licensing system. 
Sec. 1515. State examination authority. 
Sec. 1516. Reports and recommendations to Congress. 
Sec. 1517. Study and reports on defaults and foreclosures. 
TITLE VI—MISCELLANEOUS 
Sec. 1601. Study and reports on guarantee fees. 
Sec. 1602. Study and report on default risk evaluation. 
Sec. 1603. Conversion of HUD contracts. 
Sec. 1604. Bridge depository institutions. 
Sec. 1605. Sense of the Senate. 
DIVISION B—FORECLOSURE PREVENTION 
Sec. 2001. Short title. 
Sec. 2002. Emergency designation. 
TITLE I—FHA MODERNIZATION ACT OF 2008 
Sec. 2101. Short title. 
Subtitle A—Building American Homeownership 
Sec. 2111. Short title. 
Sec. 2112. Maximum principal loan obligation. 
Sec. 2113. Cash investment requirement and prohibition of seller-funded down pay-
ment assistance. 
Sec. 2114. Mortgage insurance premiums. 
Sec. 2115. Rehabilitation loans. 
Sec. 2116. Discretionary action. 
Sec. 2117. Insurance of condominiums. 
Sec. 2118. Mutual Mortgage Insurance Fund. 
Sec. 2119. Hawaiian home lands and Indian reservations. 
Sec. 2120. Conforming and technical amendments. 
Sec. 2121. Insurance of mortgages. 
Sec. 2122. Home equity conversion mortgages. 
Sec. 2123. Energy efficient mortgages program. 
Sec. 2124. Pilot program for automated process for borrowers without sufficient 
credit history. 
Sec. 2125. Homeownership preservation. 
Sec. 2126. Use of FHA savings for improvements in FHA technologies, procedures, 
processes, program performance, staffing, and salaries. 
Sec. 2127. Post-purchase housing counseling eligibility improvements. 
Sec. 2128. Pre-purchase homeownership counseling demonstration. 
Sec. 2129. Fraud prevention. 
Sec. 2130. Limitation on mortgage insurance premium increases. 
Sec. 2131. Savings provision. 
Sec. 2132. Implementation. 
Sec. 2133. Moratorium on implementation of risk-based premiums. 
Subtitle B—Manufactured Housing Loan Modernization 
Sec. 2141. Short title. 
Sec. 2142. Purposes. 
Sec. 2143. Exception to limitation on financial institution portfolio. 
Sec. 2144. Insurance benefits. 
Sec. 2145. Maximum loan limits. 
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122 STAT. 2657 
PUBLIC LAW 110–289—JULY 30, 2008 
Sec. 2146. Insurance premiums. 
Sec. 2147. Technical corrections. 
Sec. 2148. Revision of underwriting criteria. 
Sec. 2149. Prohibition against kickbacks and unearned fees. 
Sec. 2150. Leasehold requirements. 
TITLE II—MORTGAGE FORECLOSURE PROTECTIONS FOR 
SERVICEMEMBERS 
Sec. 2201. Temporary increase in maximum loan guaranty amount for certain 
housing loans guaranteed by the Secretary of Veterans Affairs. 
Sec. 2202. Counseling on mortgage foreclosures for members of the Armed Forces 
returning from service abroad. 
Sec. 2203. Enhancement of protections for servicemembers relating to mortgages 
and mortgage foreclosures. 
TITLE III—EMERGENCY ASSISTANCE FOR THE REDEVELOPMENT OF 
ABANDONED AND FORECLOSED HOMES 
Sec. 2301. Emergency assistance for the redevelopment of abandoned and fore-
closed homes. 
Sec. 2302. Nationwide distribution of resources. 
Sec. 2303. Limitation on use of funds with respect to eminent domain. 
Sec. 2304. Limitation on distribution of funds. 
Sec. 2305. Counseling intermediaries. 
TITLE IV—HOUSING COUNSELING RESOURCES 
Sec. 2401. Housing counseling resources. 
Sec. 2402. Credit counseling. 
TITLE V—MORTGAGE DISCLOSURE IMPROVEMENT ACT 
Sec. 2501. Short title. 
Sec. 2502. Enhanced mortgage loan disclosures. 
Sec. 2503. Community Development Investment Authority for depository institu-
tions. 
TITLE VI—VETERANS HOUSING MATTERS 
Sec. 2601. Home improvements and structural alterations for totally disabled mem-
bers of the Armed Forces before discharge or release from the Armed 
Forces. 
Sec. 2602. Eligibility for specially adapted housing benefits and assistance for 
members of the Armed Forces with service-connected disabilities and in-
dividuals residing outside the United States. 
Sec. 2603. Specially adapted housing assistance for individuals with severe burn in-
juries. 
Sec. 2604. Extension of assistance for individuals residing temporarily in housing 
owned by a family member. 
Sec. 2605. Increase in specially adapted housing benefits for disabled veterans. 
Sec. 2606. Report on specially adapted housing for disabled individuals. 
Sec. 2607. Report on specially adapted housing assistance for individuals who re-
side in housing owned by a family member on permanent basis. 
Sec. 2608. Definition of annual income for purposes of section 8 and other public 
housing programs. 
Sec. 2609. Payment of transportation of baggage and household effects for members 
of the Armed Forces who relocate due to foreclosure of leased housing. 
TITLE VII—SMALL PUBLIC HOUSING AUTHORITIES PAPERWORK 
REDUCTION ACT 
Sec. 2701. Short title. 
Sec. 2702. Public housing agency plans for certain qualified public housing agen-
cies. 
TITLE VIII—HOUSING PRESERVATION 
Subtitle A—Preservation Under Federal Housing Programs 
Sec. 2801. Clarification of disposition of certain properties. 
Sec. 2802. Eligibility of certain projects for enhanced voucher assistance. 
Sec. 2803. Transfer of certain rental assistance contracts. 
Sec. 2804. Public housing disaster relief. 
Sec. 2805. Preservation of certain affordable housing. 
Subtitle B—Coordination of Federal Housing Programs and Tax Incentives for 
Housing 
Sec. 2831. Short title. 
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122 STAT. 2658 
PUBLIC LAW 110–289—JULY 30, 2008 
Sec. 2832. Approvals by Department of Housing and Urban Development. 
Sec. 2833. Project approvals by rural housing service. 
Sec. 2834. Use of FHA loans with housing tax credits. 
Sec. 2835. Other HUD programs. 
TITLE IX—MISCELLANEOUS 
Sec. 2901. Homeless assistance. 
Sec. 2902. Increasing access and understanding of energy efficient mortgages. 
DIVISION C—TAX-RELATED PROVISIONS 
Sec. 3000. Short title; etc. 
TITLE I—HOUSING TAX INCENTIVES 
Subtitle A—Multi-Family Housing 
PART I—LOW-INCOME HOUSING TAX CREDIT 
Sec. 3001. Temporary increase in volume cap for low-income housing tax credit. 
Sec. 3002. Determination of credit rate. 
Sec. 3003. Modifications to definition of eligible basis. 
Sec. 3004. Other simplification and reform of low-income housing tax incentives. 
Sec. 3005. Treatment of military basic pay. 
PART II—MODIFICATIONS TO TAX-EXEMPT HOUSING BOND RULES 
Sec. 3007. Recycling of tax-exempt debt for financing residential rental projects. 
Sec. 3008. Coordination of certain rules applicable to low-income housing credit and 
qualified residential rental project exempt facility bonds. 
PART III—REFORMS RELATED TO THE LOW-INCOME HOUSING CREDIT AND TAX- 
EXEMPT HOUSING BONDS 
Sec. 3009. Hold harmless for reductions in area median gross income. 
Sec. 3010. Exception to annual current income determination requirement where 
determination not relevant. 
Subtitle B—Single Family Housing 
Sec. 3011. First-time homebuyer credit. 
Sec. 3012. Additional standard deduction for real property taxes for nonitemizers. 
Subtitle C—General Provisions 
Sec. 3021. Temporary liberalization of tax-exempt housing bond rules. 
Sec. 3022. Repeal of alternative minimum tax limitations on tax-exempt housing 
bonds, low-income housing tax credit, and rehabilitation credit. 
Sec. 3023. Bonds guaranteed by Federal home loan banks eligible for treatment as 
tax-exempt bonds. 
Sec. 3024. Modification of rules pertaining to FIRPTA nonforeign affidavits. 
Sec. 3025. Modification of definition of tax-exempt use property for purposes of the 
rehabilitation credit. 
Sec. 3026. Extension of special rule for mortgage revenue bonds for residences lo-
cated in disaster areas. 
Sec. 3027. Transfer of funds appropriated to carry out 2008 recovery rebates for in-
dividuals. 
TITLE II—REFORMS RELATED TO REAL ESTATE INVESTMENT TRUSTS 
Subtitle A—Foreign Currency and Other Qualified Activities 
Sec. 3031. Revisions to REIT income tests. 
Sec. 3032. Revisions to REIT asset tests. 
Sec. 3033. Conforming foreign currency revisions. 
Subtitle B—Taxable REIT Subsidiaries 
Sec. 3041. Conforming taxable REIT subsidiary asset test. 
Subtitle C—Dealer Sales 
Sec. 3051. Holding period under safe harbor. 
Sec. 3052. Determining value of sales under safe harbor. 
Subtitle D—Health Care REITs 
Sec. 3061. Conformity for health care facilities. 
Subtitle E—Effective Dates 
Sec. 3071. Effective dates. 
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122 STAT. 2659 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE III—REVENUE PROVISIONS 
Subtitle A—General Provisions 
Sec. 3081. Election to accelerate the AMT and research credits in lieu of bonus de-
preciation. 
Sec. 3082. Certain GO Zone incentives. 
Sec. 3083. Increase in statutory limit on the public debt. 
Subtitle B—Revenue Offsets 
Sec. 3091. Returns relating to payments made in settlement of payment card and 
third party network transactions. 
Sec. 3092. Gain from sale of principal residence allocated to nonqualified use not 
excluded from income. 
Sec. 3093. Delay in application of worldwide allocation of interest. 
Sec. 3094. Time for payment of corporate estimated taxes. 
DIVISION A—HOUSING FINANCE 
REFORM 
SEC. 1001. SHORT TITLE. 
This division may be cited as the ‘‘Federal Housing Finance 
Regulatory Reform Act of 2008’’. 
SEC. 1002. DEFINITIONS. 
(a) FEDERAL SAFETY AND SOUNDNESS ACT DEFINITIONS.—Sec-
tion 1303 of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992 (12 U.S.C. 4502) is amended— 
(1) in each of paragraphs (8), (9), (10), and (19), by striking 
‘‘Secretary’’ each place that term appears and inserting 
‘‘Director’’; 
(2) by redesignating paragraphs (16) through (19) as para-
graphs (21) through (24), respectively; 
(3) by striking paragraphs (13) through (15) and inserting 
the following: 
‘‘(19) OFFICE OF FINANCE.—The term ‘Office of Finance’ 
means the Office of Finance of the Federal Home Loan Bank 
System (or any successor thereto). 
‘‘(20) REGULATED
ENTITY.—The term ‘regulated entity’ 
means— 
‘‘(A) the Federal National Mortgage Association and 
any affiliate thereof; 
‘‘(B) the Federal Home Loan Mortgage Corporation 
and any affiliate thereof; and 
‘‘(C) any Federal Home Loan Bank.’’; 
(4) by redesignating paragraphs (11) and (12) as paragraphs 
(17) and (18), respectively; 
(5) by redesignating paragraph (7) as paragraph (12); 
(6) by redesignating paragraphs (8) through (10) as para-
graphs (14) through (16), respectively; 
(7) in paragraph (5)— 
(A) by striking ‘‘(5)’’ and inserting ‘‘(9)’’; and 
(B) by striking ‘‘Office of Federal Housing Enterprise 
Oversight of the Department of Housing and Urban 
Development’’ and inserting ‘‘Federal Housing Finance 
Agency’’; 
(8) by redesignating paragraph (6) as paragraph (10); 
(9) by redesignating paragraphs (2) through (4) as para-
graphs (5) through (7), respectively; 
12 USC 4501 
note. 
Federal Housing 
Finance 
Regulatory 
Reform Act of 
2008. 
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122 STAT. 2660 
PUBLIC LAW 110–289—JULY 30, 2008 
(10) by inserting after paragraph (7), as redesignated, the 
following: 
‘‘(8) DEFAULT; IN DANGER OF DEFAULT.— 
‘‘(A) DEFAULT.—The term ‘default’ means, with respect 
to a regulated entity, any adjudication or other official 
determination by any court of competent jurisdiction, or 
the Agency, pursuant to which a conservator, receiver, 
limited-life regulated entity, or legal custodian is appointed 
for a regulated entity. 
‘‘(B) IN
DANGER
OF
DEFAULT.—The term ‘in danger 
of default’ means a regulated entity with respect to which, 
in the opinion of the Agency— 
‘‘(i) the regulated entity is not likely to be able 
to pay the obligations of the regulated entity in the 
normal course of business; or 
‘‘(ii) the regulated entity— 
‘‘(I) has incurred or is likely to incur losses 
that will deplete all or substantially all of its cap-
ital; and 
‘‘(II) there is no reasonable prospect that the 
capital of the regulated entity will be replenished.’’; 
(11) by inserting after paragraph (1) the following: 
‘‘(2) AGENCY.—The term ‘Agency’ means the Federal 
Housing Finance Agency established under section 1311. 
‘‘(3) AUTHORIZING STATUTES.—The term ‘authorizing stat-
utes’ means— 
‘‘(A) the Federal National Mortgage Association 
Charter Act; 
‘‘(B) the Federal Home Loan Mortgage Corporation 
Act; and 
‘‘(C) the Federal Home Loan Bank Act. 
‘‘(4) BOARD.—The term ‘Board’ means the Federal Housing 
Finance Oversight Board established under section 1313A.’’; 
(12) by inserting after paragraph (10), as redesignated by 
this section, the following: 
‘‘(11) ENTITY-AFFILIATED PARTY.—The term ‘entity-affiliated 
party’ means— 
‘‘(A) any director, officer, employee, or controlling stock-
holder of, or agent for, a regulated entity; 
‘‘(B) any shareholder, affiliate, consultant, or joint ven-
ture partner of a regulated entity, and any other person, 
as determined by the Director (by regulation or on a case- 
by-case basis) that participates in the conduct of the affairs 
of a regulated entity, provided that a member of a Federal 
Home Loan Bank shall not be deemed to have participated 
in the affairs of that Bank solely by virtue of being a 
shareholder of, and obtaining advances from, that Bank; 
‘‘(C) any independent contractor for a regulated entity 
(including any attorney, appraiser, or accountant), if— 
‘‘(i) the independent contractor knowingly or reck-
lessly participates in— 
‘‘(I) any violation of any law or regulation; 
‘‘(II) any breach of fiduciary duty; or 
‘‘(III) any unsafe or unsound practice; and 
‘‘(ii) such violation, breach, or practice caused, or 
is likely to cause, more than a minimal financial loss 
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122 STAT. 2661 
PUBLIC LAW 110–289—JULY 30, 2008 
to, or a significant adverse effect on, the regulated 
entity; 
‘‘(D) any not-for-profit corporation that receives its 
principal funding, on an ongoing basis, from any regulated 
entity; and 
‘‘(E) the Office of Finance.’’; 
(13) by inserting after paragraph (12), as redesignated by 
this section, the following: 
‘‘(13) LIMITED-LIFE REGULATED ENTITY.—The term ‘limited- 
life regulated entity’ means an entity established by the Agency 
under section 1367(i) with respect to a Federal Home Loan 
Bank in default or in danger of default or with respect to 
an enterprise in default or in danger of default.’’; and 
(14) by adding at the end the following: 
‘‘(25) VIOLATION.—The term ‘violation’ includes any action 
(alone or in combination with another or others) for or toward 
causing, bringing about, participating in, counseling, or aiding 
or abetting a violation.’’. 
(b) REFERENCES IN THIS ACT.—As used in this Act, unless 
otherwise specified— 
(1) the term ‘‘Agency’’ means the Federal Housing Finance 
Agency; 
(2) the term ‘‘Director’’ means the Director of the Agency; 
and 
(3) the terms ‘‘enterprise’’, ‘‘regulated entity’’, and ‘‘author-
izing statutes’’ have the same meanings as in section 1303 
of the Federal Housing Enterprises Financial Safety and Sound-
ness Act of 1992, as amended by this Act. 
TITLE I—REFORM OF REGULATION OF 
ENTERPRISES 
Subtitle A—Improvement of Safety and 
Soundness Supervision 
SEC. 1101. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE 
AGENCY. 
The Federal Housing Enterprises Financial Safety and Sound-
ness Act of 1992 (12 U.S.C. 4501 et seq.) is amended by striking 
sections 1311 and 1312 and inserting the following: 
‘‘SEC. 1311. ESTABLISHMENT OF THE FEDERAL HOUSING FINANCE 
AGENCY. 
‘‘(a) ESTABLISHMENT.—There is established the Federal Housing 
Finance Agency, which shall be an independent agency of the Fed-
eral Government. 
‘‘(b) GENERAL SUPERVISORY AND REGULATORY AUTHORITY.— 
‘‘(1) IN GENERAL.—Each regulated entity shall, to the extent 
provided in this title, be subject to the supervision and regula-
tion of the Agency. 
‘‘(2) AUTHORITY OVER FANNIE MAE, FREDDIE MAC, THE FED-
ERAL HOME LOAN BANKS, AND THE OFFICE OF FINANCE.—The 
Director shall have general regulatory authority over each regu-
lated entity and the Office of Finance, and shall exercise such 
12 USC 4511, 
4512. 
12 USC 4511 
note. 
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122 STAT. 2662 
PUBLIC LAW 110–289—JULY 30, 2008 
general regulatory authority, including such duties and authori-
ties set forth under section 1313, to ensure that the purposes 
of this Act, the authorizing statutes, and any other applicable 
law are carried out. 
‘‘(c) SAVINGS PROVISION.—The authority of the Director to take 
actions under subtitles B and C shall not in any way limit the 
general supervisory and regulatory authority granted to the Director 
under subsection (b). 
‘‘SEC. 1312. DIRECTOR. 
‘‘(a) ESTABLISHMENT
OF POSITION.—There is established the 
position of the Director of the Agency, who shall be the head 
of the Agency. 
‘‘(b) APPOINTMENT; TERM.— 
‘‘(1) APPOINTMENT.—The Director shall be appointed by 
the President, by and with the advice and consent of the Senate, 
from among individuals who are citizens of the United States, 
have a demonstrated understanding of financial management 
or oversight, and have a demonstrated understanding of capital 
markets, including the mortgage securities markets and 
housing finance. 
‘‘(2) TERM.—The Director shall be appointed for a term 
of 5 years, unless removed before the end of such term for 
cause by the President. 
‘‘(3) VACANCY.—A vacancy in the position of Director that 
occurs before the expiration of the term for which a Director 
was appointed shall be filled in the manner established under 
paragraph (1), and the Director appointed to fill such vacancy 
shall be appointed only for the remainder of such term. 
‘‘(4) SERVICE AFTER END OF TERM.—An individual may serve 
as the Director after the expiration of the term for which 
appointed until a successor has been appointed. 
‘‘(5) 
TRANSITIONAL
PROVISION.—Notwithstanding 
para-
graphs (1) and (2), during the period beginning on the effective 
date of the Federal Housing Finance Regulatory Reform Act 
of 2008, and ending on the date on which the Director is 
appointed and confirmed, the person serving as the Director 
of the Office of Federal Housing Enterprise Oversight of the 
Department of Housing and Urban Development on that effec-
tive date shall act for all purposes as, and with the full powers 
of, the Director. 
‘‘(c) DEPUTY DIRECTOR OF THE DIVISION OF ENTERPRISE REGULA-
TION.— 
‘‘(1) IN GENERAL.—The Agency shall have a Deputy Director 
of the Division of Enterprise Regulation, who shall be des-
ignated by the Director from among individuals who are citizens 
of the United States, have a demonstrated understanding of 
financial management or oversight, and have a demonstrated 
understanding of mortgage securities markets and housing 
finance. 
‘‘(2) FUNCTIONS.—The Deputy Director of the Division of 
Enterprise Regulation shall have such functions, powers, and 
duties with respect to the oversight of the enterprises as the 
Director shall prescribe. 
‘‘(d) DEPUTY DIRECTOR OF THE DIVISION OF FEDERAL HOME 
LOAN BANK REGULATION.— 
Effective date. 
Termination 
date. 
President. 
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122 STAT. 2663 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) IN GENERAL.—The Agency shall have a Deputy Director 
of the Division of Federal Home Loan Bank Regulation, who 
shall be designated by the Director from among individuals 
who are citizens of the United States, have a demonstrated 
understanding of financial management or oversight, and have 
a demonstrated understanding of the Federal Home Loan Bank 
System and housing finance. 
‘‘(2) FUNCTIONS.—The Deputy Director of the Division of 
Federal Home Loan Bank Regulation shall have such functions, 
powers, and duties with respect to the oversight of the Federal 
Home Loan Banks as the Director shall prescribe. 
‘‘(e) DEPUTY DIRECTOR FOR HOUSING MISSION AND GOALS.— 
‘‘(1) IN GENERAL.—The Agency shall have a Deputy Director 
for Housing Mission and Goals, who shall be designated by 
the Director from among individuals who are citizens of the 
United States, and have a demonstrated understanding of the 
housing markets and housing finance. 
‘‘(2) FUNCTIONS.—The Deputy Director for Housing Mission 
and Goals shall have such functions, powers, and duties with 
respect to the oversight of the housing mission and goals of 
the enterprises, and with respect to oversight of the housing 
finance and community and economic development mission of 
the Federal Home Loan Banks, as the Director shall prescribe. 
‘‘(3) 
CONSIDERATIONS.—In 
exercising 
such 
functions, 
powers, and duties, the Deputy Director for Housing Mission 
and Goals shall consider the differences between the enterprises 
and the Federal Home Loan Banks, including those described 
in section 1313(d). 
‘‘(f) ACTING DIRECTOR.—In the event of the death, resignation, 
sickness, or absence of the Director, the President shall designate 
either the Deputy Director of the Division of Enterprise Regulation, 
the Deputy Director of the Division of Federal Home Loan Bank 
Regulation, or the Deputy Director for Housing Mission and Goals, 
to serve as acting Director until the return of the Director, or 
the appointment of a successor pursuant to subsection (b). 
‘‘(g) LIMITATIONS.—The Director and each of the Deputy Direc-
tors may not— 
‘‘(1) have any direct or indirect financial interest in any 
regulated entity or entity-affiliated party; 
‘‘(2) hold any office, position, or employment in any regu-
lated entity or entity-affiliated party; or 
‘‘(3) have served as an executive officer or director of any 
regulated entity or entity-affiliated party at any time during 
the 3-year period preceding the date of appointment or designa-
tion of such individual as Director or Deputy Director, as 
applicable.’’. 
SEC. 1102. DUTIES AND AUTHORITIES OF THE DIRECTOR. 
(a) IN GENERAL.—Section 1313 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4513) 
is amended to read as follows: 
‘‘SEC. 1313. DUTIES AND AUTHORITIES OF DIRECTOR. 
‘‘(a) DUTIES.— 
‘‘(1) PRINCIPAL DUTIES.—The principal duties of the Director 
shall be— 
‘‘(A) to oversee the prudential operations of each regu-
lated entity; and 
President. 
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122 STAT. 2664 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) to ensure that— 
‘‘(i) each regulated entity operates in a safe and 
sound manner, including maintenance of adequate cap-
ital and internal controls; 
‘‘(ii) the operations and activities of each regulated 
entity foster liquid, efficient, competitive, and resilient 
national housing finance markets (including activities 
relating to mortgages on housing for low- and mod-
erate-income families involving a reasonable economic 
return that may be less than the return earned on 
other activities); 
‘‘(iii) each regulated entity complies with this title 
and the rules, regulations, guidelines, and orders 
issued under this title and the authorizing statutes; 
‘‘(iv) each regulated entity carries out its statutory 
mission only through activities that are authorized 
under and consistent with this title and the authorizing 
statutes; and 
‘‘(v) the activities of each regulated entity and 
the manner in which such regulated entity is operated 
are consistent with the public interest. 
‘‘(2) SCOPE OF AUTHORITY.—The authority of the Director 
shall include the authority— 
‘‘(A) to review and, if warranted based on the principal 
duties described in paragraph (1), reject any acquisition 
or transfer of a controlling interest in a regulated entity; 
and 
‘‘(B) to exercise such incidental powers as may be nec-
essary or appropriate to fulfill the duties and responsibil-
ities of the Director in the supervision and regulation of 
each regulated entity. 
‘‘(b) DELEGATION OF AUTHORITY.—The Director may delegate 
to officers and employees of the Agency any of the functions, powers, 
or duties of the Director, as the Director considers appropriate. 
‘‘(c) LITIGATION AUTHORITY.— 
‘‘(1) IN GENERAL.—In enforcing any provision of this title, 
any regulation or order prescribed under this title, or any 
other provision of law, rule, regulation, or order, or in any 
other action, suit, or proceeding to which the Director is a 
party or in which the Director is interested, and in the adminis-
tration of conservatorships and receiverships, the Director may 
act in the Director’s own name and through the Director’s 
own attorneys. 
‘‘(2) SUBJECT TO SUIT.—Except as otherwise provided by 
law, the Director shall be subject to suit (other than suits 
on claims for money damages) by a regulated entity with respect 
to any matter under this title or any other applicable provision 
of law, rule, order, or regulation under this title, in the United 
States district court for the judicial district in which the regu-
lated entity has its principal place of business, or in the United 
States District Court for the District of Columbia, and the 
Director may be served with process in the manner prescribed 
by the Federal Rules of Civil Procedure.’’. 
(b) INDEPENDENCE
IN CONGRESSIONAL TESTIMONY
AND REC-
OMMENDATIONS.—Section 111 of Public Law 93–495 (12 U.S.C. 250) 
is amended by striking ‘‘the Federal Housing Finance Board’’ and 
inserting ‘‘the Director of the Federal Housing Finance Agency’’. 
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122 STAT. 2665 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1103. FEDERAL HOUSING FINANCE OVERSIGHT BOARD. 
(a) IN GENERAL.—The Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4501 et seq.) is 
amended by inserting after section 1313 the following: 
‘‘SEC. 1313A. FEDERAL HOUSING FINANCE OVERSIGHT BOARD. 
‘‘(a) IN GENERAL.—There is established the Federal Housing 
Finance Oversight Board, which shall advise the Director with 
respect to overall strategies and policies in carrying out the duties 
of the Director under this title. 
‘‘(b) LIMITATIONS.—The Board may not exercise any executive 
authority, and the Director may not delegate to the Board any 
of the functions, powers, or duties of the Director. 
‘‘(c) COMPOSITION.—The Board shall be comprised of 4 members, 
of whom— 
‘‘(1) 1 member shall be the Secretary of the Treasury; 
‘‘(2) 1 member shall be the Secretary of Housing and Urban 
Development; 
‘‘(3) 1 member shall be the Chairman of the Securities 
and Exchange Commission; and 
‘‘(4) 1 member shall be the Director, who shall serve as 
the Chairperson of the Board. 
‘‘(d) MEETINGS.— 
‘‘(1) IN GENERAL.—The Board shall meet upon notice by 
the Director, but in no event shall the Board meet less fre-
quently than once every 3 months. 
‘‘(2) SPECIAL
MEETINGS.—Either the Secretary of the 
Treasury, the Secretary of Housing and Urban Development, 
or the Chairman of the Securities and Exchange Commission 
may, upon giving written notice to the Director, require a 
special meeting of the Board. 
‘‘(e) TESTIMONY.—On an annual basis, the Board shall testify 
before Congress regarding— 
‘‘(1) the safety and soundness of the regulated entities; 
‘‘(2) any material deficiencies in the conduct of the oper-
ations of the regulated entities; 
‘‘(3) the overall operational status of the regulated entities; 
‘‘(4) an evaluation of the performance of the regulated 
entities in carrying out their respective missions; 
‘‘(5) operations, resources, and performance of the Agency; 
and 
‘‘(6) such other matters relating to the Agency and its 
fulfillment of its mission, as the Board determines appro-
priate.’’. 
(b) ANNUAL REPORT OF THE DIRECTOR.—Section 1319B(a) of 
the Federal Housing Enterprises Financial Safety and Soundness 
Act of 1992 (12 U.S.C. 4521(a)) is amended— 
(1) by striking ‘‘enterprise’’ each place that term appears 
and inserting ‘‘regulated entity’’; 
(2) by striking ‘‘enterprises’’ each place that term appears 
and inserting ‘‘regulated entities’’; 
(3) in paragraph (3), by striking ‘‘; and’’ and inserting 
a semicolon; 
(4) in paragraph (4), by striking ‘‘1994.’’ and inserting 
‘‘1994; and’’; and 
(5) by adding at the end the following: 
Deadline. 
Deadlines. 
Notices. 
Establishment. 
12 USC 4513a. 
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122 STAT. 2666 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(5) the assessment of the Board or any of its members 
with respect to— 
‘‘(A) the safety and soundness of the regulated entities; 
‘‘(B) any material deficiencies in the conduct of the 
operations of the regulated entities; 
‘‘(C) the overall operational status of the regulated 
entities; and 
‘‘(D) an evaluation of the performance of the regulated 
entities in carrying out their respective missions; 
‘‘(6) operations, resources, and performance of the Agency; 
and 
‘‘(7) such other matters relating to the Agency and the 
fulfillment of its mission.’’. 
SEC. 1104. AUTHORITY TO REQUIRE REPORTS BY REGULATED ENTI-
TIES. 
(a) IN GENERAL.—Section 1314 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4514) 
is amended— 
(1) in the section heading, by striking ‘‘ENTERPRISES’’ and 
inserting ‘‘REGULATED ENTITIES’’; 
(2) by striking ‘‘an enterprise’’ each place that term appears 
and inserting ‘‘a regulated entity’’; 
(3) by striking ‘‘the enterprise’’ and inserting ‘‘the regulated 
entity’’; 
(4) in subsection (a)— 
(A) by striking the subsection heading and all that 
follows through ‘‘and operations’’ in paragraph (1) and 
inserting the following: 
‘‘(a) REGULAR AND SPECIAL REPORTS.— 
‘‘(1) REGULAR REPORTS.—The Director may require, by gen-
eral or specific orders, a regulated entity to submit regular 
reports, including financial statements determined on a fair 
value basis, on the condition (including financial condition), 
management, activities, or operations of the regulated entity, 
as the Director considers appropriate’’; and 
(B) in paragraph (2)— 
(i) by inserting ‘‘, by general or specific orders,’’ 
after ‘‘may also require’’; and 
(ii) by striking ‘‘whenever’’ and inserting ‘‘on any 
of the topics specified in paragraph (1) or any other 
relevant topics, if’’; and 
(5) by adding at the end the following: 
‘‘(c) PENALTIES FOR FAILURE TO MAKE REPORTS.— 
‘‘(1) VIOLATIONS.—It shall be a violation of this section 
for any regulated entity— 
‘‘(A) to fail to make, transmit, or publish any report 
or obtain any information required by the Director under 
this section, section 309(k) of the Federal National Mort-
gage Association Charter Act, section 307(c) of the Federal 
Home Loan Mortgage Corporation Act, or section 20 of 
the Federal Home Loan Bank Act, within the period of 
time specified in such provision of law or otherwise by 
the Director; or 
‘‘(B) to submit or publish any false or misleading report 
or information under this section. 
‘‘(2) PENALTIES.— 
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122 STAT. 2667 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) FIRST TIER.— 
‘‘(i) IN GENERAL.—A violation described in para-
graph (1) shall be subject to a penalty of not more 
than $2,000 for each day during which such violation 
continues, in any case in which— 
‘‘(I) the subject regulated entity maintains 
procedures reasonably adapted to avoid any inad-
vertent error and the violation was unintentional 
and a result of such an error; or 
‘‘(II) the violation was an inadvertent trans-
mittal or publication of any report which was mini-
mally late. 
‘‘(ii) BURDEN
OF
PROOF.—For purposes of this 
subparagraph, the regulated entity shall have the bur-
den of proving that the error was inadvertent or that 
a report was inadvertently transmitted or published 
late. 
‘‘(B) SECOND TIER.—A violation described in paragraph 
(1) shall be subject to a penalty of not more than $20,000 
for each day during which such violation continues or such 
false or misleading information is not corrected, in any 
case that is not addressed in subparagraph (A) or (C). 
‘‘(C) THIRD TIER.—A violation described in paragraph 
(1) shall be subject to a penalty of not more than $1,000,000 
per day for each day during which such violation continues 
or such false or misleading information is not corrected, 
in any case in which the subject regulated entity committed 
such violation knowingly or with reckless disregard for 
the accuracy of any such information or report. 
‘‘(3) ASSESSMENTS.—Any penalty imposed under this sub-
section shall be in lieu of a penalty under section 1376, but 
shall be assessed and collected by the Director in the manner 
provided in section 1376 for penalties imposed under that sec-
tion, and any such assessment (including the determination 
of the amount of the penalty) shall be otherwise subject to 
the provisions of section 1376. 
‘‘(4) HEARING.—A regulated entity against which a penalty 
is assessed under this section shall be afforded an agency 
hearing if the regulated entity submits a request for a hearing 
not later than 20 days after the date of the issuance of the 
notice of assessment. Section 1374 shall apply to any such 
proceedings.’’. 
(b) CONFORMING AMENDMENT.—The Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 
et seq.) is amended by striking sections 1327 and 1328. 
SEC. 1105. EXAMINERS AND ACCOUNTANTS; AUTHORITY TO CONTRACT 
FOR REVIEWS OF REGULATED ENTITIES; OMBUDSMAN. 
(a) IN GENERAL.—Section 1317 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4517) 
is amended— 
(1) in subsection (a), by striking ‘‘enterprise’’ each place 
that term appears and inserting ‘‘regulated entity’’; 
(2) in subsection (b)— 
(A) by inserting ‘‘of a regulated entity’’ after ‘‘under 
this section’’; and 
12 USC 4547, 
4548. 
Applicability. 
Deadline. 
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122 STAT. 2668 
PUBLIC LAW 110–289—JULY 30, 2008 
(B) by striking ‘‘to determine the condition of an enter-
prise for the purpose of ensuring its financial safety and 
soundness’’ and inserting ‘‘or appropriate’’; 
(3) in subsection (c), in the second sentence, by inserting 
before the period ‘‘to conduct examinations under this section’’; 
(4) by redesignating subsections (d) through (f) as sub-
sections (e) through (g), respectively; and 
(5) by inserting after subsection (c) the following: 
‘‘(d) INSPECTOR GENERAL.—There shall be within the Agency 
an Inspector General, who shall be appointed in accordance with 
section 3(a) of the Inspector General Act of 1978.’’. 
(b) DIRECT HIRE AUTHORITY TO HIRE ACCOUNTANTS, ECONO-
MISTS, AND EXAMINERS.—Section 1317 of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4517) is amended by adding at the end the following: 
‘‘(h) APPOINTMENT OF ACCOUNTANTS, ECONOMISTS, AND EXAM-
INERS.— 
‘‘(1) APPLICABILITY.—This section shall apply with respect 
to any position of examiner, accountant, economist, and spe-
cialist in financial markets and in technology at the Agency, 
with respect to supervision and regulation of the regulated 
entities, that is in the competitive service. 
‘‘(2) APPOINTMENT AUTHORITY.—The Director may appoint 
candidates to any position described in paragraph (1)— 
‘‘(A) in accordance with the statutes, rules, and regula-
tions governing appointments in the excepted service; and 
‘‘(B) notwithstanding any statutes, rules, and regula-
tions governing appointments in the competitive service.’’. 
(c) AMENDMENTS TO INSPECTOR GENERAL ACT.—Section 11 of 
the Inspector General Act of 1978 (5 U.S.C. App.) is amended— 
(1) in paragraph (1), by inserting ‘‘; the Director of the 
Federal Housing Finance Agency’’ after ‘‘Social Security 
Administration’’; and 
(2) in paragraph (2), by inserting ‘‘, the Federal Housing 
Finance Agency’’ after ‘‘Social Security Administration’’. 
(d) AUTHORITY TO CONTRACT FOR REVIEWS OF REGULATED ENTI-
TIES.—Section 1319 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4519) is amended— 
(1) in the section heading, by striking ‘‘ENTERPRISES BY 
RATING ORGANIZATION’’ and inserting ‘‘REGULATED ENTITIES’’; 
and 
(2) by striking ‘‘enterprises’’ and inserting ‘‘regulated enti-
ties’’. 
(e) OFFICE OF THE OMBUDSMAN.—Section 1317 of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4517) is amended by adding at the end the following: 
‘‘(i) OMBUDSMAN.—The Director shall establish, by regulation, 
an Office of the Ombudsman within the Agency, which shall be 
responsible for considering complaints and appeals, from any regu-
lated entity and any person that has a business relationship with 
a regulated entity, regarding any matter relating to the regulation 
and supervision of such regulated entity by the Agency. The regula-
tion issued by the Director under this subsection shall specify 
the authority and duties of the Office of the Ombudsman.’’. 
Establishment. 
Regulations. 
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122 STAT. 2669 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1106. ASSESSMENTS. 
Section 1316 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4516) is amended— 
(1) by striking subsection (a) and inserting the following: 
‘‘(a) ANNUAL ASSESSMENTS.—The Director shall establish and 
collect from the regulated entities annual assessments in an amount 
not exceeding the amount sufficient to provide for reasonable costs 
(including administrative costs) and expenses of the Agency, 
including— 
‘‘(1) the expenses of any examinations under section 1317 
of this Act and under section 20 of the Federal Home Loan 
Bank Act; 
‘‘(2) the expenses of obtaining any reviews and credit 
assessments under section 1319; 
‘‘(3) such amounts in excess of actual expenses for any 
given year as deemed necessary by the Director to maintain 
a working capital fund in accordance with subsection (e); and 
‘‘(4) the windup of the affairs of the Office of Federal 
Housing Enterprise Oversight and the Federal Housing Finance 
Board under title III of the Federal Housing Finance Regulatory 
Reform Act of 2008.’’; 
(2) in subsection (b)— 
(A) by realigning the margins of paragraph (2) two 
ems from the left, so as to align the left margin of such 
paragraph with the left margins of paragraph (1); 
(B) by redesignating paragraphs (2) and (3) as para-
graphs (3) and (4), respectively; and 
(C) by inserting after paragraph (1) the following: 
‘‘(2) SEPARATE TREATMENT OF FEDERAL HOME LOAN BANK 
AND ENTERPRISE ASSESSMENTS.—Assessments collected from the 
enterprises shall not exceed the amounts sufficient to provide 
for the costs and expenses described in subsection (a) relating 
to the enterprises. Assessments collected from the Federal 
Home Loan Banks shall not exceed the amounts sufficient 
to provide for the costs and expenses described in subsection 
(a) relating to the Federal Home Loan Banks.’’; 
(3) by striking subsection (c) and inserting the following: 
‘‘(c) INCREASED COSTS OF REGULATION.— 
‘‘(1) INCREASE FOR INADEQUATE CAPITALIZATION.—The semi-
annual payments made pursuant to subsection (b) by any regu-
lated entity that is not classified (for purposes of subtitle B) 
as adequately capitalized may be increased, as necessary, in 
the discretion of the Director to pay additional estimated costs 
of regulation of the regulated entity. 
‘‘(2) ADJUSTMENT
FOR
ENFORCEMENT
ACTIVITIES.—The 
Director may adjust the amounts of any semiannual payments 
for an assessment under subsection (a) that are to be paid 
pursuant to subsection (b) by a regulated entity, as necessary 
in the discretion of the Director, to ensure that the costs of 
enforcement activities under this Act for a regulated entity 
are borne only by such regulated entity. 
‘‘(3) ADDITIONAL ASSESSMENT FOR DEFICIENCIES.—If at any 
time, as a result of increased costs of regulation of a regulated 
entity that is not classified (for purposes of subtitle B) as 
adequately capitalized or as the result of supervisory or enforce-
ment activities under this Act for a regulated entity, the amount 
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122 STAT. 2670 
PUBLIC LAW 110–289—JULY 30, 2008 
available from any semiannual payment made by such regu-
lated entity pursuant to subsection (b) is insufficient to cover 
the costs of the Agency with respect to such entity, the Director 
may make and collect from such regulated entity an immediate 
assessment to cover the amount of such deficiency for the 
semiannual period. If, at the end of any semiannual period 
during which such an assessment is made, any amount remains 
from such assessment, such remaining amount shall be 
deducted from the assessment for such regulated entity for 
the following semiannual period.’’; 
(4) in subsection (d), by striking ‘‘If’’ and inserting ‘‘Except 
with respect to amounts collected pursuant to subsection (a)(3), 
if’’; and 
(5) by striking subsections (e) through (g) and inserting 
the following: 
‘‘(e) WORKING CAPITAL FUND.—At the end of each year for 
which an assessment under this section is made, the Director shall 
remit to each regulated entity any amount of assessment collected 
from such regulated entity that is attributable to subsection (a)(3) 
and is in excess of the amount the Director deems necessary to 
maintain a working capital fund. 
‘‘(f) TREATMENT OF ASSESSMENTS.— 
‘‘(1) DEPOSIT.—Amounts received by the Director from 
assessments under this section may be deposited by the Director 
in the manner provided in section 5234 of the Revised Statutes 
of the United States (12 U.S.C. 192) for monies deposited by 
the Comptroller of the Currency. 
‘‘(2) NOT GOVERNMENT FUNDS.—The amounts received by 
the Director from any assessment under this section shall not 
be construed to be Government or public funds or appropriated 
money. 
‘‘(3) NO APPORTIONMENT OF FUNDS.—Notwithstanding any 
other provision of law, the amounts received by the Director 
from any assessment under this section shall not be subject 
to apportionment for the purpose of chapter 15 of title 31, 
United States Code, or under any other authority. 
‘‘(4) USE OF FUNDS.—The Director may use any amounts 
received by the Director from assessments under this section 
for compensation of the Director and other employees of the 
Agency and for all other expenses of the Director and the 
Agency. 
‘‘(5) AVAILABILITY OF OVERSIGHT FUND AMOUNTS.—Notwith-
standing any other provision of law, any amounts remaining 
in the Federal Housing Enterprises Oversight Fund established 
under this section (as in effect before the effective date of 
the Federal Housing Finance Regulatory Reform Act of 2008, 
and any amounts remaining from assessments on the Federal 
Home Loan Banks pursuant to section 18(b) of the Federal 
Home Loan Bank Act (12 U.S.C. 1438(b)), shall, upon such 
effective date, be treated for purposes of this subsection as 
amounts received from assessments under this section. 
‘‘(6) TREASURY INVESTMENTS.— 
‘‘(A) AUTHORITY.—The Director may request the Sec-
retary of the Treasury to invest such portions of amounts 
received by the Director from assessments paid under this 
section that, in the Director’s discretion, are not required 
to meet the current working needs of the Agency. 
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122 STAT. 2671 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) 
GOVERNMENT
OBLIGATIONS.—Pursuant 
to 
a 
request under subparagraph (A), the Secretary of the 
Treasury shall invest such amounts in Government obliga-
tions guaranteed as to principal and interest by the United 
States with maturities suitable to the needs of the Agency 
and bearing interest at a rate determined by the Secretary 
of the Treasury taking into consideration current market 
yields on outstanding marketable obligations of the United 
States of comparable maturity. 
‘‘(g) BUDGET AND FINANCIAL MANAGEMENT.— 
‘‘(1) FINANCIAL
OPERATING
PLANS
AND
FORECASTS.—The 
Director shall provide to the Director of the Office of Manage-
ment and Budget copies of the Director’s financial operating 
plans and forecasts, as prepared by the Director in the ordinary 
course of the Agency’s operations, and copies of the quarterly 
reports of the Agency’s financial condition and results of oper-
ations, as prepared by the Director in the ordinary course 
of the Agency’s operations. 
‘‘(2) FINANCIAL
STATEMENTS.—The Agency shall prepare 
annually a statement of— 
‘‘(A) assets and liabilities and surplus or deficit; 
‘‘(B) income and expenses; and 
‘‘(C) sources and application of funds. 
‘‘(3) FINANCIAL MANAGEMENT SYSTEMS.—The Agency shall 
implement and maintain financial management systems that— 
‘‘(A) comply substantially with Federal financial 
management systems requirements and applicable Federal 
accounting standards; and 
‘‘(B) use a general ledger system that accounts for 
activity at the transaction level. 
‘‘(4) ASSERTION OF INTERNAL CONTROLS.—The Director shall 
provide to the Comptroller General of the United States an 
assertion as to the effectiveness of the internal controls that 
apply to financial reporting by the Agency, using the standards 
established in section 3512(c) of title 31, United States Code. 
‘‘(5) RULE OF CONSTRUCTION.—This subsection may not be 
construed as implying any obligation on the part of the Director 
to consult with or obtain the consent or approval of the Director 
of the Office of Management and Budget with respect to any 
report, plan, forecast, or other information referred to in para-
graph (1) or any jurisdiction or oversight over the affairs or 
operations of the Agency. 
‘‘(h) AUDIT OF AGENCY.— 
‘‘(1) IN GENERAL.—The Comptroller General shall annually 
audit the financial transactions of the Agency in accordance 
with the United States generally accepted government auditing 
standards as may be prescribed by the Comptroller General 
of the United States. The audit shall be conducted at the 
place or places where accounts of the Agency are normally 
kept. The representatives of the Government Accountability 
Office shall have access to the personnel and to all books, 
accounts, documents, papers, records (including electronic 
records), reports, files, and all other papers, automated data, 
things, or property belonging to or under the control of or 
used or employed by the Agency pertaining to its financial 
transactions and necessary to facilitate the audit, and such 
representatives shall be afforded full facilities for verifying 
Deadline. 
Records. 
Deadline. 
Reports. 
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122 STAT. 2672 
PUBLIC LAW 110–289—JULY 30, 2008 
transactions with the balances or securities held by deposi-
tories, fiscal agents, and custodians. All such books, accounts, 
documents, records, reports, files, papers, and property of the 
Agency shall remain in possession and custody of the Agency. 
The Comptroller General may obtain and duplicate any such 
books, accounts, documents, records, working papers, auto-
mated data and files, or other information relevant to such 
audit without cost to the Comptroller General and the Comp-
troller General’s right of access to such information shall be 
enforceable pursuant to section 716(c) of title 31, United States 
Code. 
‘‘(2) REPORT.—The Comptroller General shall submit to 
the Congress a report of each annual audit conducted under 
this subsection. The report to the Congress shall set forth 
the scope of the audit and shall include the statement of assets 
and liabilities and surplus or deficit, the statement of income 
and expenses, the statement of sources and application of funds, 
and such comments and information as may be deemed nec-
essary to inform Congress of the financial operations and condi-
tion of the Agency, together with such recommendations with 
respect thereto as the Comptroller General may deem advisable. 
A copy of each report shall be furnished to the President and 
to the Agency at the time submitted to the Congress. 
‘‘(3) ASSISTANCE AND COSTS.—For the purpose of conducting 
an audit under this subsection, the Comptroller General may, 
in the discretion of the Comptroller General, employ by con-
tract, without regard to section 3709 of the Revised Statutes 
of the United States (41 U.S.C. 5), professional services of 
firms and organizations of certified public accountants for tem-
porary periods or for special purposes. Upon the request of 
the Comptroller General, the Director of the Agency shall 
transfer to the Government Accountability Office from funds 
available, the amount requested by the Comptroller General 
to cover the full costs of any audit and report conducted by 
the Comptroller General. The Comptroller General shall credit 
funds transferred to the account established for salaries and 
expenses of the Government Accountability Office, and such 
amount shall be available upon receipt and without fiscal year 
limitation to cover the full costs of the audit and report.’’. 
SEC. 1107. REGULATIONS AND ORDERS. 
Section 1319G of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4526) is amended— 
(1) by striking subsection (a) and inserting the following: 
‘‘(a) AUTHORITY.—The Director shall issue any regulations, 
guidelines, or orders necessary to carry out the duties of the Director 
under this title or the authorizing statutes, and to ensure that 
the purposes of this title and the authorizing statutes are accom-
plished.’’; and 
(2) by striking subsection (c). 
SEC. 1108. PRUDENTIAL MANAGEMENT AND OPERATIONS STANDARDS. 
The Federal Housing Enterprises Financial Safety and Sound-
ness Act of 1992 (12 U.S.C. 4501 et seq.) is amended by inserting 
after section 1313A, as added by this Act, the following new section: 
Guidelines. 
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122 STAT. 2673 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘SEC. 1313B. PRUDENTIAL MANAGEMENT AND OPERATIONS STAND-
ARDS. 
‘‘(a) STANDARDS.—The Director shall establish standards, by 
regulation or guideline, for each regulated entity relating to— 
‘‘(1) adequacy of internal controls and information systems 
taking into account the nature and scale of business operations; 
‘‘(2) independence and adequacy of internal audit systems; 
‘‘(3) management of interest rate risk exposure; 
‘‘(4) management of market risk, including standards that 
provide for systems that accurately measure, monitor, and con-
trol market risks and, as warranted, that establish limitations 
on market risk; 
‘‘(5) adequacy and maintenance of liquidity and reserves; 
‘‘(6) management of asset and investment portfolio growth; 
‘‘(7) investments and acquisitions of assets by a regulated 
entity, to ensure that they are consistent with the purposes 
of this title and the authorizing statutes; 
‘‘(8) overall risk management processes, including adequacy 
of oversight by senior management and the board of directors 
and of processes and policies to identify, measure, monitor, 
and control material risks, including reputational risks, and 
for adequate, well-tested business resumption plans for all 
major systems with remote site facilities to protect against 
disruptive events; 
‘‘(9) management of credit and counterparty risk, including 
systems to identify concentrations of credit risk and prudential 
limits to restrict exposure of the regulated entity to a single 
counterparty or groups of related counterparties; 
‘‘(10) maintenance of adequate records, in accordance with 
consistent accounting policies and practices that enable the 
Director to evaluate the financial condition of the regulated 
entity; and 
‘‘(11) such other operational and management standards 
as the Director determines to be appropriate. 
‘‘(b) FAILURE TO MEET STANDARDS.— 
‘‘(1) PLAN REQUIREMENT.— 
‘‘(A) IN GENERAL.—If the Director determines that a 
regulated entity fails to meet any standard established 
under subsection (a)— 
‘‘(i) if such standard is established by regulation, 
the Director shall require the regulated entity to 
submit an acceptable plan to the Director within the 
time allowed under subparagraph (C); and 
‘‘(ii) if such standard is established by guideline, 
the Director may require the regulated entity to submit 
a plan described in clause (i). 
‘‘(B) CONTENTS.—Any plan required under subpara-
graph (A) shall specify the actions that the regulated entity 
will take to correct the deficiency. If the regulated entity 
is undercapitalized, the plan may be a part of the capital 
restoration plan for the regulated entity under section 
1369C. 
‘‘(C) DEADLINES
FOR
SUBMISSION
AND
REVIEW.—The 
Director shall by regulation establish deadlines that— 
‘‘(i) provide the regulated entities with reasonable 
time to submit plans required under subparagraph 
(A), and generally require a regulated entity to submit 
Regulations. 
Regulations. 
Guidelines. 
12 USC 4513b. 
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122 STAT. 2674 
PUBLIC LAW 110–289—JULY 30, 2008 
a plan not later than 30 days after the Director deter-
mines that the entity fails to meet any standard estab-
lished under subsection (a); and 
‘‘(ii) require the Director to act on plans expedi-
tiously, and generally not later than 30 days after 
the plan is submitted. 
‘‘(2) REQUIRED ORDER UPON FAILURE TO SUBMIT OR IMPLE-
MENT PLAN.—If a regulated entity fails to submit an acceptable 
plan within the time allowed under paragraph (1)(C), or fails 
in any material respect to implement a plan accepted by the 
Director, the following shall apply: 
‘‘(A) REQUIRED
CORRECTION
OF
DEFICIENCY.—The 
Director shall, by order, require the regulated entity to 
correct the deficiency. 
‘‘(B) OTHER AUTHORITY.—The Director may, by order, 
take one or more of the following actions until the deficiency 
is corrected: 
‘‘(i) Prohibit the regulated entity from permitting 
its average total assets (as such term is defined in 
section 1316(b)) during any calendar quarter to exceed 
its average total assets during the preceding calendar 
quarter, or restrict the rate at which the average total 
assets of the entity may increase from one calendar 
quarter to another. 
‘‘(ii) Require the regulated entity— 
‘‘(I) in the case of an enterprise, to increase 
its ratio of core capital to assets. 
‘‘(II) in the case of a Federal Home Loan Bank, 
to increase its ratio of total capital (as such term 
is defined in section 6(a)(5) of the Federal Home 
Loan Bank Act (12 U.S.C. 1426(a)(5)) to assets. 
‘‘(iii) Require the regulated entity to take any other 
action that the Director determines will better carry 
out the purposes of this section than any of the actions 
described in this subparagraph. 
‘‘(3) MANDATORY RESTRICTIONS.—In complying with para-
graph (2), the Director shall take one or more of the actions 
described in clauses (i) through (iii) of paragraph (2)(B) if— 
‘‘(A) the Director determines that the regulated entity 
fails to meet any standard prescribed under subsection 
(a); 
‘‘(B) the regulated entity has not corrected the defi-
ciency; and 
‘‘(C) during the 18-month period before the date on 
which the regulated entity first failed to meet the standard, 
the entity underwent extraordinary growth, as defined by 
the Director. 
‘‘(c) OTHER ENFORCEMENT AUTHORITY NOT AFFECTED.—The 
authority of the Director under this section is in addition to any 
other authority of the Director.’’. 
SEC. 1109. REVIEW OF AND AUTHORITY OVER ENTERPRISE ASSETS 
AND LIABILITIES. 
(a) IN GENERAL.—Subtitle B of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4611 et 
seq.) is amended— 
Applicability. 
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122 STAT. 2675 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) by striking the subtitle designation and heading and 
inserting the following: 
‘‘Subtitle B—Required Capital Levels for 
Regulated Entities, Special Enforcement 
Powers, and Reviews of Assets and Li-
abilities’’; 
and 
(2) by adding at the end the following new section: 
‘‘SEC. 1369E. REVIEWS OF ENTERPRISE ASSETS AND LIABILITIES. 
‘‘(a) IN GENERAL.—The Director shall, by regulation, establish 
criteria governing the portfolio holdings of the enterprises, to ensure 
that the holdings are backed by sufficient capital and consistent 
with the mission and the safe and sound operations of the enter-
prises. In establishing such criteria, the Director shall consider 
the ability of the enterprises to provide a liquid secondary market 
through securitization activities, the portfolio holdings in relation 
to the overall mortgage market, and adherence to the standards 
specified in section 1313B. 
‘‘(b) TEMPORARY ADJUSTMENTS.—The Director may, by order, 
make temporary adjustments to the established standards for an 
enterprise or both enterprises, such as during times of economic 
distress or market disruption. 
‘‘(c) AUTHORITY TO REQUIRE DISPOSITION OR ACQUISITION.— 
The Director shall monitor the portfolio of each enterprise. Pursuant 
to subsection (a) and notwithstanding the capital classifications 
of the enterprises, the Director may, by order, require an enterprise, 
under such terms and conditions as the Director determines to 
be appropriate, to dispose of or acquire any asset, if the Director 
determines that such action is consistent with the purposes of 
this Act or any of the authorizing statutes.’’. 
(b) REGULATIONS.—Not later than the expiration of the 180- 
day period beginning on the effective date of this Act, the Director 
shall issue regulations pursuant to section 1369E(a) of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(as added by subsection (a) of this section) establishing the portfolio 
holdings standards under such section. 
SEC. 1110. RISK-BASED CAPITAL REQUIREMENTS. 
(a) IN GENERAL.—Section 1361 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4611) 
is amended to read as follows: 
‘‘SEC. 1361. RISK-BASED CAPITAL LEVELS FOR REGULATED ENTITIES. 
‘‘(a) IN GENERAL.— 
‘‘(1) ENTERPRISES.—The Director shall, by regulation, estab-
lish risk-based capital requirements for the enterprises to 
ensure that the enterprises operate in a safe and sound manner, 
maintaining sufficient capital and reserves to support the risks 
that arise in the operations and management of the enterprises. 
‘‘(2) FEDERAL HOME LOAN BANKS.—The Director shall estab-
lish risk-based capital standards under section 6 of the Federal 
Home Loan Bank Act for the Federal Home Loan Banks. 
Standards. 
Regulations. 
Deadline. 
Standards. 
12 USC 4624 
note. 
Regulations. 
Criteria. 
12 USC 4624. 
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122 STAT. 2676 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(b) NO LIMITATION.—Nothing in this section shall limit the 
authority of the Director to require other reports or undertakings, 
or take other action, in furtherance of the responsibilities of the 
Director under this Act.’’. 
(b) FEDERAL HOME LOAN BANKS RISK-BASED CAPITAL.—Section 
6(a)(3) of the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(3)) 
is amended— 
(1) by striking subparagraph (A) and inserting the fol-
lowing: 
‘‘(A) RISK-BASED
CAPITAL
STANDARDS.—The Director 
shall, by regulation, establish risk-based capital standards 
for the Federal Home Loan Banks to ensure that the Fed-
eral Home Loan Banks operate in a safe and sound manner, 
with sufficient permanent capital and reserves to support 
the risks that arise in the operations and management 
of the Federal Home Loans Banks.’’; and 
(2) in subparagraph (B), by striking ‘‘(A)(ii)’’ and inserting 
‘‘(A)’’. 
SEC. 1111. MINIMUM CAPITAL LEVELS. 
Section 1362 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4612) is amended— 
(1) in subsection (a), by striking ‘‘IN GENERAL’’ and inserting 
‘‘ENTERPRISES’’; and 
(2) by striking subsection (b) and inserting the following: 
‘‘(b) FEDERAL HOME LOAN BANKS.—For purposes of this subtitle, 
the minimum capital level for each Federal Home Loan Bank shall 
be the minimum capital required to be maintained to comply with 
the leverage requirement for the bank established under section 
6(a)(2) of the Federal Home Loan Bank Act (12 U.S.C. 1426(a)(2)). 
‘‘(c) ESTABLISHMENT OF REVISED MINIMUM CAPITAL LEVELS.— 
Notwithstanding subsections (a) and (b) and notwithstanding the 
capital classifications of the regulated entities, the Director may, 
by regulations issued under section 1319G, establish a minimum 
capital level for the enterprises, for the Federal Home Loan Banks, 
or for both the enterprises and the banks, that is higher than 
the level specified in subsection (a) for the enterprises or the level 
specified in subsection (b) for the Federal Home Loan Banks, to 
the extent needed to ensure that the regulated entities operate 
in a safe and sound manner. 
‘‘(d) AUTHORITY TO REQUIRE TEMPORARY INCREASE.— 
‘‘(1) IN GENERAL.—Notwithstanding subsections (a) and (b) 
and any minimum capital level established pursuant to sub-
section (c), the Director may, by order, increase the minimum 
capital level for a regulated entity on a temporary basis, when 
the Director determines that such an increase is necessary 
and consistent with the prudential regulation and the safe 
and sound operations of a regulated entity. 
‘‘(2) RESCISSION.—The Director shall rescind any temporary 
minimum capital level established under paragraph (1) when 
the Director determines that the circumstances or facts no 
longer justify the temporary minimum capital level. 
‘‘(3) REGULATIONS
REQUIRED.—The Director shall issue 
regulations establishing— 
‘‘(A) standards for the imposition of a temporary 
increase in minimum capital under paragraph (1); 
Regulations. 
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122 STAT. 2677 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) the standards and procedures that the Director 
will use to make the determination referred to in paragraph 
(2); and 
‘‘(C) a reasonable time frame for periodic review of 
any temporary increase in minimum capital for the purpose 
of making the determination referred to in paragraph (2). 
‘‘(e) AUTHORITY
TO
ESTABLISH
ADDITIONAL
CAPITAL
AND 
RESERVE REQUIREMENTS FOR PARTICULAR PURPOSES.—The Director 
may, at any time by order or regulation, establish such capital 
or reserve requirements with respect to any product or activity 
of a regulated entity, as the Director considers appropriate to ensure 
that the regulated entity operates in a safe and sound manner, 
with sufficient capital and reserves to support the risks that arise 
in the operations and management of the regulated entity. 
‘‘(f) PERIODIC REVIEW.—The Director shall periodically review 
the amount of core capital maintained by the enterprises, the 
amount of capital retained by the Federal Home Loan Banks, and 
the minimum capital levels established for such regulated entities 
pursuant to this section.’’. 
SEC. 1112. REGISTRATION UNDER THE SECURITIES LAWS. 
The Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.) 
is amended by adding at the end the following: 
‘‘SEC. 38. FEDERAL NATIONAL MORTGAGE ASSOCIATION, FEDERAL 
HOME LOAN MORTGAGE CORPORATION, FEDERAL HOME 
LOAN BANKS. 
‘‘(a) FEDERAL NATIONAL MORTGAGE ASSOCIATION AND FEDERAL 
HOME LOAN MORTGAGE CORPORATION.—No class of equity securities 
of the Federal National Mortgage Association or the Federal Home 
Loan Mortgage Corporation shall be treated as an exempted security 
for purposes of section 12, 13, 14, or 16. 
‘‘(b) FEDERAL HOME LOAN BANKS.— 
‘‘(1) REGISTRATION.—Each Federal Home Loan Bank shall 
register a class of its common stock under section 12(g), not 
later than 120 days after the date of enactment of the Federal 
Housing Finance Regulatory Reform Act of 2008, and shall 
thereafter maintain such registration and be treated for pur-
poses of this title as an ‘issuer’, the securities of which are 
required to be registered under section 12, regardless of the 
number of members holding such stock at any given time. 
‘‘(2) STANDARDS
RELATING
TO
AUDIT
COMMITTEES.—Each 
Federal Home Loan Bank shall comply with the rules issued 
by the Commission under section 10A(m). 
‘‘(c) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply: 
‘‘(1) FEDERAL HOME LOAN BANK; MEMBER.—The terms ‘Fed-
eral Home Loan Bank’ and ‘member’, have the same meanings 
as in section 2 of the Federal Home Loan Bank Act. 
‘‘(2) FEDERAL NATIONAL MORTGAGE ASSOCIATION.—The term 
‘Federal National Mortgage Association’ means the corporation 
created by the Federal National Mortgage Association Charter 
Act. 
‘‘(3) FEDERAL HOME LOAN MORTGAGE CORPORATION.—The 
term ‘Federal Home Loan Mortgage Corporation’ means the 
corporation created by the Federal Home Loan Mortgage Cor-
poration Act.’’. 
Deadline. 
15 USC 78oo. 
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122 STAT. 2678 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1113. PROHIBITION AND WITHHOLDING OF EXECUTIVE COM-
PENSATION. 
(a) IN GENERAL.—Section 1318 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518) 
is amended— 
(1) in the section heading, by striking ‘‘OF
EXCESSIVE’’ 
and inserting ‘‘AND WITHHOLDING OF EXECUTIVE’’; 
(2) in subsection (a)— 
(A) by striking ‘‘enterprise’’ and inserting ‘‘regulated 
entity’’; and 
(B) by striking ‘‘enterprises’’ and inserting ‘‘regulated 
entities’’; 
(3) by redesignating subsection (b) as subsection (d); and 
(4) by inserting after subsection (a) the following: 
‘‘(b) FACTORS.—In making any determination under subsection 
(a), the Director may take into consideration any factors the Director 
considers relevant, including any wrongdoing on the part of the 
executive officer, and such wrongdoing shall include any fraudulent 
act or omission, breach of trust or fiduciary duty, violation of 
law, rule, regulation, order, or written agreement, and insider abuse 
with respect to the regulated entity. The approval of an agreement 
or contract pursuant to section 309(d)(3)(B) of the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1723a(d)(3)(B)) or 
section 303(h)(2) of the Federal Home Loan Mortgage Corporation 
Act (12 U.S.C. 1452(h)(2)) shall not preclude the Director from 
making any subsequent determination under subsection (a). 
‘‘(c) WITHHOLDING
OF COMPENSATION.—In carrying out sub-
section (a), the Director may require a regulated entity to withhold 
any payment, transfer, or disbursement of compensation to an 
executive officer, or to place such compensation in an escrow 
account, during the review of the reasonableness and comparability 
of compensation.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) FANNIE MAE.—Section 309(d) of the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1723a(d)) is 
amended by adding at the end the following new paragraph: 
‘‘(4) Notwithstanding any other provision of this section, the 
corporation shall not transfer, disburse, or pay compensation to 
any executive officer, or enter into an agreement with such executive 
officer, without the approval of the Director, for matters being 
reviewed under section 1318 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).’’. 
(2) FREDDIE
MAC.—Section 303(h) of the Federal Home 
Loan Mortgage Corporation Act (12 U.S.C. 1452(h)) is amended 
by adding at the end the following new paragraph: 
‘‘(4) Notwithstanding any other provision of this section, the 
Corporation shall not transfer, disburse, or pay compensation to 
any executive officer, or enter into an agreement with such executive 
officer, without the approval of the Director, for matters being 
reviewed under section 1318 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4518).’’. 
(3) FEDERAL HOME LOAN BANKS.—Section 7 of the Federal 
Home Loan Bank Act (12 U.S.C. 1427) is amended by adding 
at the end the following new subsection: 
‘‘(l) WITHHOLDING
OF COMPENSATION.—Notwithstanding any 
other provision of this section, a Federal Home Loan Bank shall 
not transfer, disburse, or pay compensation to any executive officer, 
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122 STAT. 2679 
PUBLIC LAW 110–289—JULY 30, 2008 
or enter into an agreement with such executive officer, without 
the approval of the Director, for matters being reviewed under 
section 1318 of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992 (12 U.S.C. 4518).’’. 
SEC. 1114. LIMIT ON GOLDEN PARACHUTES. 
Section 1318 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4518) is amended 
by adding at the end the following: 
‘‘(e) AUTHORITY TO REGULATE OR PROHIBIT CERTAIN FORMS 
OF BENEFITS TO AFFILIATED PARTIES.— 
‘‘(1) GOLDEN
PARACHUTES
AND
INDEMNIFICATION
PAY-
MENTS.—The Director may prohibit or limit, by regulation or 
order, any golden parachute payment or indemnification pay-
ment. 
‘‘(2) FACTORS TO BE TAKEN INTO ACCOUNT.—The Director 
shall prescribe, by regulation, the factors to be considered by 
the Director in taking any action pursuant to paragraph (1), 
which may include such factors as— 
‘‘(A) whether there is a reasonable basis to believe 
that the affiliated party has committed any fraudulent 
act or omission, breach of trust or fiduciary duty, or insider 
abuse with regard to the regulated entity that has had 
a material effect on the financial condition of the regulated 
entity; 
‘‘(B) whether there is a reasonable basis to believe 
that the affiliated party is substantially responsible for 
the insolvency of the regulated entity, the appointment 
of a conservator or receiver for the regulated entity, or 
the troubled condition of the regulated entity (as defined 
in regulations prescribed by the Director); 
‘‘(C) whether there is a reasonable basis to believe 
that the affiliated party has materially violated any 
applicable provision of Federal or State law or regulation 
that has had a material effect on the financial condition 
of the regulated entity; 
‘‘(D) whether the affiliated party was in a position 
of managerial or fiduciary responsibility; and 
‘‘(E) the length of time that the party was affiliated 
with the regulated entity, and the degree to which— 
‘‘(i) the payment reasonably reflects compensation 
earned over the period of employment; and 
‘‘(ii) the compensation involved represents a 
reasonable payment for services rendered. 
‘‘(3) CERTAIN PAYMENTS PROHIBITED.—No regulated entity 
may prepay the salary or any liability or legal expense of 
any affiliated party if such payment is made— 
‘‘(A) in contemplation of the insolvency of such regu-
lated entity, or after the commission of an act of insolvency; 
and 
‘‘(B) with a view to, or having the result of— 
‘‘(i) preventing the proper application of the assets 
of the regulated entity to creditors; or 
‘‘(ii) preferring one creditor over another. 
‘‘(4) GOLDEN PARACHUTE PAYMENT DEFINED.— 
‘‘(A) IN GENERAL.—For purposes of this subsection, the 
term ‘golden parachute payment’ means any payment (or 
Regulations. 
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122 STAT. 2680 
PUBLIC LAW 110–289—JULY 30, 2008 
any agreement to make any payment) in the nature of 
compensation by any regulated entity for the benefit of 
any affiliated party pursuant to an obligation of such regu-
lated entity that— 
‘‘(i) is contingent on the termination of such party’s 
affiliation with the regulated entity; and 
‘‘(ii) is received on or after the date on which— 
‘‘(I) the regulated entity became insolvent; 
‘‘(II) any conservator or receiver is appointed 
for such regulated entity; or 
‘‘(III) the Director determines that the regu-
lated entity is in a troubled condition (as defined 
in the regulations of the Director). 
‘‘(B) CERTAIN
PAYMENTS
IN
CONTEMPLATION
OF
AN 
EVENT.—Any payment which would be a golden parachute 
payment but for the fact that such payment was made 
before the date referred to in subparagraph (A)(ii) shall 
be treated as a golden parachute payment if the payment 
was made in contemplation of the occurrence of an event 
described in any subclause of such subparagraph. 
‘‘(C) CERTAIN PAYMENTS NOT INCLUDED.—For purposes 
of this subsection, the term ‘golden parachute payment’ 
shall not include— 
‘‘(i) any payment made pursuant to a retirement 
plan which is qualified (or is intended to be qualified) 
under section 401 of the Internal Revenue Code of 
1986, or other nondiscriminatory benefit plan; 
‘‘(ii) any payment made pursuant to a bona fide 
deferred compensation plan or arrangement which the 
Director determines, by regulation or order, to be 
permissible; or 
‘‘(iii) any payment made by reason of the death 
or disability of an affiliated party. 
‘‘(5) OTHER DEFINITIONS.—For purposes of this subsection, 
the following definitions shall apply: 
‘‘(A) INDEMNIFICATION PAYMENT.—Subject to paragraph 
(6), the term ‘indemnification payment’ means any payment 
(or any agreement to make any payment) by any regulated 
entity for the benefit of any person who is or was an 
affiliated party, to pay or reimburse such person for any 
liability or legal expense with regard to any administrative 
proceeding or civil action instituted by the Agency which 
results in a final order under which such person— 
‘‘(i) is assessed a civil money penalty; 
‘‘(ii) is removed or prohibited from participating 
in conduct of the affairs of the regulated entity; or 
‘‘(iii) is required to take any affirmative action 
to correct certain conditions resulting from violations 
or practices, by order of the Director. 
‘‘(B) LIABILITY OR LEGAL EXPENSE.—The term ‘liability 
or legal expense’ means— 
‘‘(i) any legal or other professional expense 
incurred in connection with any claim, proceeding, or 
action; 
‘‘(ii) the amount of, and any cost incurred in 
connection with, any settlement of any claim, pro-
ceeding, or action; and 
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122 STAT. 2681 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iii) the amount of, and any cost incurred in 
connection with, any judgment or penalty imposed with 
respect to any claim, proceeding, or action. 
‘‘(C) PAYMENT.—The term ‘payment’ includes— 
‘‘(i) any direct or indirect transfer of any funds 
or any asset; and 
‘‘(ii) any segregation of any funds or assets for 
the purpose of making, or pursuant to an agreement 
to make, any payment after the date on which such 
funds or assets are segregated, without regard to 
whether the obligation to make such payment is contin-
gent on— 
‘‘(I) the determination, after such date, of the 
liability for the payment of such amount; or 
‘‘(II) the liquidation, after such date, of the 
amount of such payment. 
‘‘(6) CERTAIN
COMMERCIAL
INSURANCE
COVERAGE
NOT 
TREATED AS COVERED BENEFIT PAYMENT.—No provision of this 
subsection shall be construed as prohibiting any regulated 
entity from purchasing any commercial insurance policy or 
fidelity bond, except that, subject to any requirement described 
in paragraph (5)(A)(iii), such insurance policy or bond shall 
not cover any legal or liability expense of the regulated entity 
which is described in paragraph (5)(A).’’. 
SEC. 1115. REPORTING OF FRAUDULENT LOANS. 
Part 1 of subtitle C of the Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 (12 U.S.C. 4631 et seq.), 
as amended by this Act, is amended by adding at the end the 
following: 
‘‘SEC. 1379E. REPORTING OF FRAUDULENT LOANS. 
‘‘(a) REQUIREMENT TO REPORT.—The Director shall require a 
regulated entity to submit to the Director a timely report upon 
discovery by the regulated entity that it has purchased or sold 
a fraudulent loan or financial instrument, or suspects a possible 
fraud relating to the purchase or sale of any loan or financial 
instrument. The Director shall require each regulated entity to 
establish and maintain procedures designed to discover any such 
transactions. 
‘‘(b) PROTECTION FROM LIABILITY FOR REPORTS.—Any regulated 
entity that, in good faith, makes a report pursuant to subsection 
(a), and any entity-affiliated party, that, in good faith, makes or 
requires another to make any such report, shall not be liable 
to any person under any provision of law or regulation, any constitu-
tion, law, or regulation of any State or political subdivision of 
any State, or under any contract or other legally enforceable agree-
ment (including any arbitration agreement) for such report or for 
any failure to provide notice of such report to the person who 
is the subject of such report or any other persons identified in 
the report.’’. 
SEC. 1116. INCLUSION OF MINORITIES AND WOMEN; DIVERSITY IN 
AGENCY WORKFORCE. 
Section 1319A of the Housing and Community Development 
Act of 1992 (12 U.S.C. 4520) is amended— 
(1) in the section heading, by striking ‘‘EQUAL
OPPOR-
TUNITY
IN
SOLICITATION
OF
CONTRACTS’’ and inserting 
Procedures. 
12 USC 4642. 
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122 STAT. 2682 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘MINORITY
AND
WOMEN
INCLUSION; DIVERSITY
REQUIRE-
MENTS’’; 
(2) in subsection (a), by striking ‘‘(a) IN GENERAL.—Each 
enterprise’’ and inserting ‘‘(e) OUTREACH.—Each regulated 
entity’’; and 
(3) by striking subsection (b); 
(4) by inserting before subsection (e), as so redesignated 
by paragraph (2) of this section, the following new subsections: 
‘‘(a) OFFICE OF MINORITY AND WOMEN INCLUSION.—Each regu-
lated entity shall establish an Office of Minority and Women Inclu-
sion, or designate an office of the entity, that shall be responsible 
for carrying out this section and all matters of the entity relating 
to diversity in management, employment, and business activities 
in accordance with such standards and requirements as the Director 
shall establish. 
‘‘(b) INCLUSION IN ALL LEVELS OF BUSINESS ACTIVITIES.—Each 
regulated entity shall develop and implement standards and proce-
dures to ensure, to the maximum extent possible, the inclusion 
and utilization of minorities (as such term is defined in section 
1204(c) of the Financial Institutions Reform, Recovery, and Enforce-
ment Act of 1989 (12 U.S.C. 1811 note)) and women, and minority- 
and women-owned businesses (as such terms are defined in section 
21A(r)(4) of the Federal Home Loan Bank Act (12 U.S.C. 1441a(r)(4)) 
(including financial institutions, investment banking firms, mort-
gage banking firms, asset management firms, broker-dealers, finan-
cial services firms, underwriters, accountants, brokers, investment 
consultants, and providers of legal services) in all business and 
activities of the regulated entity at all levels, including in procure-
ment, insurance, and all types of contracts (including contracts 
for the issuance or guarantee of any debt, equity, or mortgage- 
related securities, the management of its mortgage and securities 
portfolios, the making of its equity investments, the purchase, sale 
and servicing of single- and multi-family mortgage loans, and the 
implementation of its affordable housing program and initiatives). 
The processes established by each regulated entity for review and 
evaluation for contract proposals and to hire service providers shall 
include a component that gives consideration to the diversity of 
the applicant. 
‘‘(c) APPLICABILITY.—This section shall apply to all contracts 
of a regulated entity for services of any kind, including services 
that require the services of investment banking, asset management 
entities, broker-dealers, financial services entities, underwriters, 
accountants, investment consultants, and providers of legal services. 
‘‘(d) INCLUSION IN ANNUAL REPORTS.—Each regulated entity 
shall include, in the annual report submitted by the entity to 
the Director pursuant to section 309(k) of the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1723a(k)), section 
307(c) of the Federal Home Loan Mortgage Corporation Act (12 
U.S.C. 1456(c)), and section 20 of the Federal Home Loan Bank 
Act (12 U.S.C. 1440), as applicable, detailed information describing 
the actions taken by the entity pursuant to this section, which 
shall include a statement of the total amounts paid by the entity 
to third party contractors since the last such report and the percent-
age of such amounts paid to businesses described in subsection 
(b) of this section.’’; and 
(5) by adding at the end the following new subsection: 
Contracts. 
Standards. 
Procedures. 
Establishment. 
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122 STAT. 2683 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(f) DIVERSITY IN AGENCY WORKFORCE.—The Agency shall take 
affirmative steps to seek diversity in its workforce at all levels 
of the agency consistent with the demographic diversity of the 
United States, which shall include— 
‘‘(1) heavily recruiting at historically Black colleges and 
universities, Hispanic-serving institutions, women’s colleges, 
and colleges that typically serve majority minority populations; 
‘‘(2) sponsoring and recruiting at job fairs in urban commu-
nities, and placing employment advertisements in newspapers 
and magazines oriented toward women and people of color; 
‘‘(3) partnering with organizations that are focused on 
developing opportunities for minorities and women to place 
talented young minorities and women in industry internships, 
summer employment, and full-time positions; and 
‘‘(4) where feasible, partnering with inner-city high schools, 
girls’ high schools, and high schools with majority minority 
populations to establish or enhance financial literacy programs 
and provide mentoring.’’. 
SEC. 1117. TEMPORARY AUTHORITY FOR PURCHASE OF OBLIGATIONS 
OF REGULATED ENTITIES BY SECRETARY OF TREASURY. 
(a) FANNIE MAE.—Section 304 of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1719) is amended by adding 
at the end the following new subsection: 
‘‘(g) TEMPORARY AUTHORITY OF TREASURY TO PURCHASE OBLIGA-
TIONS AND SECURITIES; CONDITIONS.— 
‘‘(1) AUTHORITY TO PURCHASE.— 
‘‘(A) GENERAL AUTHORITY.—In addition to the authority 
under subsection (c) of this section, the Secretary of the 
Treasury is authorized to purchase any obligations and 
other securities issued by the corporation under any section 
of this Act, on such terms and conditions as the Secretary 
may determine and in such amounts as the Secretary may 
determine. Nothing in this subsection requires the corpora-
tion to issue obligations or securities to the Secretary with-
out mutual agreement between the Secretary and the cor-
poration. Nothing in this subsection permits or authorizes 
the Secretary, without the agreement of the corporation, 
to engage in open market purchases of the common securi-
ties of the corporation. 
‘‘(B) 
EMERGENCY
DETERMINATION
REQUIRED.—In 
connection with any use of this authority, the Secretary 
must determine that such actions are necessary to— 
‘‘(i) provide stability to the financial markets; 
‘‘(ii) prevent disruptions in the availability of mort-
gage finance; and 
‘‘(iii) protect the taxpayer. 
‘‘(C) CONSIDERATIONS.—To protect the taxpayers, the 
Secretary of the Treasury shall take into consideration 
the following in connection with exercising the authority 
contained in this paragraph: 
‘‘(i) The need for preferences or priorities regarding 
payments to the Government. 
‘‘(ii) Limits on maturity or disposition of obligations 
or securities to be purchased. 
‘‘(iii) The corporation’s plan for the orderly resump-
tion of private market funding or capital market access. 
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122 STAT. 2684 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iv) The probability of the corporation fulfilling 
the terms of any such obligation or other security, 
including repayment. 
‘‘(v) The need to maintain the corporation’s status 
as a private shareholder-owned company. 
‘‘(vi) Restrictions on the use of corporation 
resources, including limitations on the payment of divi-
dends and executive compensation and any such other 
terms and conditions as appropriate for those purposes. 
‘‘(D) REPORTS
TO
CONGRESS.—Upon exercise of this 
authority, the Secretary shall report to the Committees 
on the Budget, Financial Services, and Ways and Means 
of the House of Representatives and the Committees on 
the Budget, Finance, and Banking, Housing, and Urban 
Affairs of the Senate as to the necessity for the purchase 
and the determinations made by the Secretary under 
subparagraph (B) and with respect to the considerations 
required under subparagraph (C), and the size, terms, and 
probability of repayment or fulfillment of other terms of 
such purchase. 
‘‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES.— 
‘‘(A) EXERCISE
OF
RIGHTS.—The Secretary of the 
Treasury may, at any time, exercise any rights received 
in connection with such purchases. 
‘‘(B) SALE OF OBLIGATION AND SECURITIES.—The Sec-
retary of the Treasury may, at any time, subject to the 
terms of the security or otherwise upon terms and condi-
tions and at prices determined by the Secretary, sell any 
obligation or security acquired by the Secretary under this 
subsection. 
‘‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGA-
TIONS OR SECURITIES.—The authority of the Secretary of 
the Treasury to hold, exercise any rights received in connec-
tion with, or sell, any obligations or securities purchased 
is not subject to the provisions of paragraph (4). 
‘‘(3) FUNDING.—For the purpose of the authorities granted 
in this subsection, the Secretary of the Treasury may use 
the proceeds of the sale of any securities issued under chapter 
31 of Title 31, and the purposes for which securities may 
be issued under chapter 31 of Title 31 are extended to include 
such purchases and the exercise of any rights in connection 
with such purchases. Any funds expended for the purchase 
of, or modifications to, obligations and securities, or the exercise 
of any rights received in connection with such purchases under 
this subsection shall be deemed appropriated at the time of 
such purchase, modification, or exercise. 
‘‘(4) TERMINATION OF AUTHORITY.—The authority under this 
subsection (g), with the exception of paragraphs (2) and (3) 
of this subsection, shall expire December 31, 2009. 
‘‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECU-
TIVE COMPENSATION.—The Director shall have the power to 
approve, disapprove, or modify the executive compensation of 
the corporation, as defined under Regulation S-K, 17 C.F.R. 
229.’’. 
(b) FREDDIE MAC.—Section 306 of the Federal Home Loan 
Mortgage Corporation Act (12 U.S.C. 1455) is amended by adding 
at the end the following new subsection: 
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122 STAT. 2685 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(l) TEMPORARY AUTHORITY OF TREASURY TO PURCHASE OBLIGA-
TIONS AND SECURITIES; CONDITIONS.— 
‘‘(1) AUTHORITY TO PURCHASE.— 
‘‘(A) GENERAL AUTHORITY.—In addition to the authority 
under subsection (c) of this section, the Secretary of the 
Treasury is authorized to purchase any obligations and 
other securities issued by the Corporation under any sec-
tion of this Act, on such terms and conditions as the Sec-
retary may determine and in such amounts as the Sec-
retary may determine. Nothing in this subsection requires 
the Corporation to issue obligations or securities to the 
Secretary without mutual agreement between the Secretary 
and the Corporation. Nothing in this subsection permits 
or authorizes the Secretary, without the agreement of the 
Corporation, to engage in open market purchases of the 
common securities of the Corporation. 
‘‘(B) 
EMERGENCY
DETERMINATION
REQUIRED.—In 
connection with any use of this authority, the Secretary 
must determine that such actions are necessary to— 
‘‘(i) provide stability to the financial markets; 
‘‘(ii) prevent disruptions in the availability of mort-
gage finance; and 
‘‘(iii) protect the taxpayer. 
‘‘(C) CONSIDERATIONS.—To protect the taxpayers, the 
Secretary of the Treasury shall take into consideration 
the following in connection with exercising the authority 
contained in this paragraph: 
‘‘(i) The need for preferences or priorities regarding 
payments to the Government. 
‘‘(ii) Limits on maturity or disposition of obligations 
or securities to be purchased. 
‘‘(iii) The Corporation’s plan for the orderly 
resumption of private market funding or capital market 
access. 
‘‘(iv) The probability of the Corporation fulfilling 
the terms of any such obligation or other security, 
including repayment. 
‘‘(v) The need to maintain the Corporation’s status 
as a private shareholder-owned company. 
‘‘(vi) Restrictions on the use of Corporation 
resources, including limitations on the payment of divi-
dends and executive compensation and any such other 
terms and conditions as appropriate for those purposes. 
‘‘(D) REPORTS
TO
CONGRESS.—Upon exercise of this 
authority, the Secretary shall report to the Committees 
on the Budget, Financial Services, and Ways and Means 
of the House of Representatives and the Committees on 
the Budget, Finance, and Banking, Housing, and Urban 
Affairs of the Senate as to the necessity for the purchase 
and the determinations made by the Secretary under 
subparagraph (B) and with respect to the considerations 
required under subparagraph (C), and the size, terms, and 
probability of repayment or fulfillment of other terms of 
such purchase. 
‘‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES.— 
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122 STAT. 2686 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) EXERCISE
OF
RIGHTS.—The Secretary of the 
Treasury may, at any time, exercise any rights received 
in connection with such purchases. 
‘‘(B) SALE OF OBLIGATION AND SECURITIES.—The Sec-
retary of the Treasury may, at any time, subject to the 
terms of the security or otherwise upon terms and condi-
tions and at prices determined by the Secretary, sell any 
obligation or security acquired by the Secretary under this 
subsection. 
‘‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGA-
TIONS OR SECURITIES.—The authority of the Secretary of 
the Treasury to hold, exercise any rights received in connec-
tion with, or sell, any obligations or securities purchased 
is not subject to the provisions of paragraph (4). 
‘‘(3) FUNDING.—For the purpose of the authorities granted 
in this subsection, the Secretary of the Treasury may use 
the proceeds of the sale of any securities issued under chapter 
31 of Title 31, and the purposes for which securities may 
be issued under chapter 31 of Title 31 are extended to include 
such purchases and the exercise of any rights in connection 
with such purchases. Any funds expended for the purchase 
of, or modifications to, obligations and securities, or the exercise 
of any rights received in connection with such purchases under 
this subsection shall be deemed appropriated at the time of 
such purchase, modification, or exercise. 
‘‘(4) TERMINATION OF AUTHORITY.—The authority under this 
subsection (l), with the exception of paragraphs (2) and (3) 
of this subsection, shall expire December 31, 2009. 
‘‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECU-
TIVE COMPENSATION.—The Director shall have the power to 
approve, disapprove, or modify the executive compensation of 
the Corporation, as defined under Regulation S-K, 17 C.F.R. 
229.’’. 
(c) FEDERAL HOME LOAN BANKS.—Section 11 of the Federal 
Home Loan Bank Act (12 U.S.C. 1431) is amended by adding 
at the end the following new subsection: 
‘‘(l) TEMPORARY AUTHORITY OF TREASURY TO PURCHASE OBLIGA-
TIONS; CONDITIONS.— 
‘‘(1) AUTHORITY TO PURCHASE.— 
‘‘(A) GENERAL AUTHORITY.—In addition to the authority 
under subsection (i) of this section, the Secretary of the 
Treasury is authorized to purchase any obligations issued 
by any Federal Home Loan Bank under any section of 
this Act, on such terms and conditions as the Secretary 
may determine and in such amounts as the Secretary may 
determine. Nothing in this subsection requires a Federal 
Home Loan Bank to issue obligations or securities to the 
Secretary without mutual agreement between the Secretary 
and the Federal Home Loan Bank. Nothing in this sub-
section permits or authorizes the Secretary, without the 
agreement of the Federal Home Loan Bank, to engage 
in open market purchases of the common securities of 
any Federal Home Loan Bank. 
‘‘(B) 
EMERGENCY
DETERMINATION
REQUIRED.—In 
connection with any use of this authority, the Secretary 
must determine that such actions are necessary to— 
‘‘(i) provide stability to the financial markets; 
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122 STAT. 2687 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) prevent disruptions in the availability of mort-
gage finance; and 
‘‘(iii) protect the taxpayer. 
‘‘(C) CONSIDERATIONS.—To protect the taxpayers, the 
Secretary of the Treasury shall take into consideration 
the following in connection with exercising the authority 
contained in this paragraph: 
‘‘(i) The need for preferences or priorities regarding 
payments to the Government. 
‘‘(ii) Limits on maturity or disposition of obligations 
or securities to be purchased. 
‘‘(iii) The Federal Home Loan Bank’s plan for the 
orderly resumption of private market funding or capital 
market access. 
‘‘(iv) The probability of the Federal Home Loan 
Bank fulfilling the terms of any such obligation or 
other security, including repayment. 
‘‘(v) The need to maintain the Federal Home Loan 
Bank’s status as a private shareholder-owned company. 
‘‘(vi) Restrictions on the use of Federal Home Loan 
Bank resources, including limitations on the payment 
of dividends and executive compensation and any such 
other terms and conditions as appropriate for those 
purposes. 
‘‘(D) REPORTS
TO
CONGRESS.—Upon exercise of this 
authority, the Secretary shall report to the Committees 
on the Budget, Financial Services, and Ways and Means 
of the House of Representatives and the Committees on 
the Budget, Finance, and Banking, Housing, and Urban 
Affairs of the Senate as to the necessity for the purchase 
and the determinations made by the Secretary under 
subparagraph (B) and with respect to the considerations 
required under subparagraph (C), and the size, terms, and 
probability of repayment or fulfillment of other terms of 
such purchase. 
‘‘(2) RIGHTS; SALE OF OBLIGATIONS AND SECURITIES.— 
‘‘(A) EXERCISE
OF
RIGHTS.—The Secretary of the 
Treasury may, at any time, exercise any rights received 
in connection with such purchases. 
‘‘(B) SALE
OF
OBLIGATIONS.—The Secretary of the 
Treasury may, at any time, subject to the terms of the 
security or otherwise upon terms and conditions and at 
prices determined by the Secretary, sell any obligation 
acquired by the Secretary under this subsection. 
‘‘(C) APPLICATION OF SUNSET TO PURCHASED OBLIGA-
TIONS.—The authority of the Secretary of the Treasury 
to hold, exercise any rights received in connection with, 
or sell, any obligations purchased is not subject to the 
provisions of paragraph (4). 
‘‘(3) FUNDING.—For the purpose of the authorities granted 
in this subsection, the Secretary of the Treasury may use 
the proceeds of the sale of any securities issued under chapter 
31 of Title 31, and the purposes for which securities may 
be issued under chapter 31 of Title 31 are extended to include 
such purchases and the exercise of any rights in connection 
with such purchases. Any funds expended for the purchase 
of, or modifications to, obligations and securities, or the exercise 
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122 STAT. 2688 
PUBLIC LAW 110–289—JULY 30, 2008 
of any rights received in connection with such purchases under 
this subsection shall be deemed appropriated at the time of 
such purchase, modification, or exercise. 
‘‘(4) TERMINATION OF AUTHORITY.—The authority under this 
subsection (l), with the exception of paragraphs (2) and (3) 
of this subsection, shall expire December 31, 2009. 
‘‘(5) AUTHORITY OF THE DIRECTOR WITH RESPECT TO EXECU-
TIVE COMPENSATION.—The Director shall have the power to 
approve, disapprove, or modify the executive compensation of 
the Federal Home Loan Bank, as defined under Regulation 
S-K, 17 C.F.R. 229.’’. 
SEC. 1118. CONSULTATION BETWEEN THE DIRECTOR OF THE FEDERAL 
HOUSING FINANCE AGENCY AND THE BOARD OF GOV-
ERNORS OF THE FEDERAL RESERVE SYSTEM TO ENSURE 
FINANCIAL MARKET STABILITY . 
Subsection (a) of section 1313 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4513), 
as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new paragraph: 
‘‘(3) COORDINATION
WITH
THE
CHAIRMAN
OF
THE
BOARD 
OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM.— 
‘‘(A) CONSULTATION.— The Director shall consult with, 
and consider the views of, the Chairman of the Board 
of Governors of the Federal Reserve System, with respect 
to the risks posed by the regulated entities to the financial 
system, prior to issuing any proposed or final regulations, 
orders, and guidelines with respect to the exercise of the 
additional authority provided in this Act regarding pruden-
tial management and operations standards, safe and sound 
operations of, and capital requirements and portfolio stand-
ards applicable to the regulated entities (as such term 
is defined in section 1303). The Director also shall consult 
with the Chairman regarding any decision to place a regu-
lated entity into conservatorship or receivership. 
‘‘(B) INFORMATION SHARING.—To facilitate the consult-
ative process, the Director shall share information with 
the Board of Governors of the Federal Reserve System 
on a regular, periodic basis as determined by the Director 
and the Board regarding the capital, asset and liabilities, 
financial condition, and risk management practices of the 
regulated entities as well as any information related to 
financial market stability. 
‘‘(C) TERMINATION OF CONSULTATION REQUIREMENT.— 
The requirement of the Director to consult with the Board 
of Governors of the Federal Reserve System under this 
paragraph shall expire at the conclusion of December 31, 
2009.’’. 
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122 STAT. 2689 
PUBLIC LAW 110–289—JULY 30, 2008 
Subtitle B—Improvement of Mission 
Supervision 
SEC. 1121. TRANSFER OF PROGRAM APPROVAL AND HOUSING GOAL 
OVERSIGHT. 
Part 2 of subtitle A of the Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 (12 U.S.C. 4541 et seq.) 
is amended— 
(1) by striking the heading for the part and inserting the 
following: 
‘‘PART 2—ADDITIONAL AUTHORITIES OF THE 
DIRECTOR’’; 
and 
(2) by striking sections 1321 and 1322. 
SEC. 1122. ASSUMPTION BY THE DIRECTOR OF CERTAIN OTHER HUD 
RESPONSIBILITIES. 
(a) IN GENERAL.—Part 2 of subtitle A of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4541 et seq.) is amended— 
(1) by striking ‘‘Secretary’’ each place that term appears 
and inserting ‘‘Director’’ in each of sections 1323, 1326, 1327, 
1328, and 1336; and 
(2) by striking sections 1338 and 1349 (12 U.S.C. 4562 
note and 4589). 
(b) RETENTION OF FAIR HOUSING RESPONSIBILITIES.—Section 
1325 of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 (12 U.S.C. 4545) is amended in the matter 
preceding paragraph (1), by inserting ‘‘of Housing and Urban 
Development’’ after ‘‘The Secretary’’. 
SEC. 1123. REVIEW OF ENTERPRISE PRODUCTS. 
Part 2 of subtitle A of the Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 (12 U.S.C. 4541 et seq.) 
is amended by inserting before section 1323 the following: 
‘‘SEC. 1321. PRIOR APPROVAL AUTHORITY FOR PRODUCTS. 
‘‘(a) IN GENERAL.—The Director shall require each enterprise 
to obtain the approval of the Director for any product of the enter-
prise before initially offering the product. 
‘‘(b) STANDARD FOR APPROVAL.—In considering any request for 
approval of a product pursuant to subsection (a), the Director shall 
make a determination that— 
‘‘(1) in the case of a product of the Federal National Mort-
gage Association, the product is authorized under paragraph 
(2), (3), (4), or (5) of section 302(b) or section 304 of the Federal 
National Mortgage Association Charter Act (12 U.S.C. 1717(b), 
1719); 
‘‘(2) in the case of a product of the Federal Home Loan 
Mortgage Corporation, the product is authorized under para-
graph (1), (4), or (5) of section 305(a) of the Federal Home 
Loan Mortgage Corporation Act (12 U.S.C. 1454(a)); 
‘‘(3) the product is in the public interest; and 
12 USC 4541. 
12 USC 4543, 
4546–4548, 4566. 
12 USC 4541, 
4542. 
12 USC 4541. 
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122 STAT. 2690 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(4) the product is consistent with the safety and soundness 
of the enterprise or the mortgage finance system. 
‘‘(c) PROCEDURE FOR APPROVAL.— 
‘‘(1) SUBMISSION OF REQUEST.—An enterprise shall submit 
to the Director a written request for approval of a product 
that describes the product in such form as prescribed by order 
or regulation of the Director. 
‘‘(2) REQUEST FOR PUBLIC COMMENT.—Immediately upon 
receipt of a request for approval of a product, as required 
under paragraph (1), the Director shall publish notice of such 
request and of the period for public comment pursuant to 
paragraph (3) regarding the product, and a description of the 
product proposed by the request. The Director shall give 
interested parties the opportunity to respond in writing to 
the proposed product. 
‘‘(3) PUBLIC COMMENT PERIOD.—During the 30-day period 
beginning on the date of publication pursuant to paragraph 
(2) of a request for approval of a product, the Director shall 
receive public comments regarding the proposed product. 
‘‘(4) OFFERING OF PRODUCT.— 
‘‘(A) IN GENERAL.—Not later than 30 days after the 
close of the public comment period described in paragraph 
(3), the Director shall approve or deny the product, speci-
fying the grounds for such decision in writing. 
‘‘(B) FAILURE TO ACT.—If the Director fails to act within 
the 30-day period described in subparagraph (A), then the 
enterprise may offer the product. 
‘‘(C) TEMPORARY APPROVAL.—The Director may, subject 
to the rules of the Director, provide for temporary approval 
of the offering of a product without a public comment 
period, if the Director finds that the existence of exigent 
circumstances makes such delay contrary to the public 
interest. 
‘‘(d) CONDITIONAL APPROVAL.—If the Director approves the 
offering of any product by an enterprise, the Director may establish 
terms, conditions, or limitations with respect to such product with 
which the enterprise must comply in order to offer such product. 
‘‘(e) EXCLUSIONS.— 
‘‘(1) IN
GENERAL.—The requirements of subsections (a) 
through (d) do not apply with respect to— 
‘‘(A) the automated loan underwriting system of an 
enterprise in existence as of the date of enactment of the 
Federal Housing Finance Regulatory Reform Act of 2008, 
including any upgrade to the technology, operating system, 
or software to operate the underwriting system; 
‘‘(B) any modification to the mortgage terms and condi-
tions or mortgage underwriting criteria relating to the 
mortgages that are purchased or guaranteed by an enter-
prise, provided that such modifications do not alter the 
underlying transaction so as to include services or 
financing, other than residential mortgage financing; or 
‘‘(C) any other activity that is substantially similar, 
as determined by rule of the Director to— 
‘‘(i) the activities described in subparagraphs (A) 
and (B); and 
‘‘(ii) other activities that have been approved by 
the Director in accordance with this section. 
Deadline. 
Publication. 
Notice. 
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122 STAT. 2691 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) EXPEDITED REVIEW.— 
‘‘(A) ENTERPRISE NOTICE.—For any new activity that 
an enterprise considers not to be a product, the enterprise 
shall provide written notice to the Director of such activity, 
and may not commence such activity until the date of 
receipt of a notice under subparagraph (B) or the expiration 
of the period described in subparagraph (C). The Director 
shall establish, by regulation, the form and content of 
such written notice. 
‘‘(B) DIRECTOR
DETERMINATION.—Not later than 15 
days after the date of receipt of a notice under subpara-
graph (A), the Director shall determine whether such 
activity is a product subject to approval under this section. 
The Director shall, immediately upon so determining, notify 
the enterprise. 
‘‘(C) FAILURE TO ACT.—If the Director fails to determine 
whether such activity is a product within the 15-day period 
described in subparagraph (B), the enterprise may com-
mence the new activity in accordance with subparagraph 
(A). 
‘‘(f) NO LIMITATION.—Nothing in this section may be construed 
to restrict— 
‘‘(1) the safety and soundness authority of the Director 
over all new and existing products or activities; or 
‘‘(2) the authority of the Director to review all new and 
existing products or activities to determine that such products 
or activities are consistent with the statutory mission of an 
enterprise.’’. 
SEC. 1124. CONFORMING LOAN LIMITS. 
(a) FANNIE MAE.— 
(1) GENERAL
LIMIT.—Section 302(b)(2) of the Federal 
National Mortgage Association Charter Act (12 U.S.C. 
1717(b)(2)) is amended by striking the 7th and 8th sentences 
and inserting the following new sentences: ‘‘Such limitations 
shall not exceed $417,000 for a mortgage secured by a single- 
family residence, $533,850 for a mortgage secured by a 2- 
family residence, $645,300 for a mortgage secured by a 3- 
family residence, and $801,950 for a mortgage secured by a 
4-family residence, except that such maximum limitations shall 
be adjusted effective January 1 of each year beginning after 
the effective date of the Federal Housing Finance Regulatory 
Reform Act of 2008, subject to the limitations in this paragraph. 
Each adjustment shall be made by adding to each such amount 
(as it may have been previously adjusted) a percentage thereof 
equal to the percentage increase, during the most recent 12- 
month or 4-quarter period ending before the time of determining 
such annual adjustment, in the housing price index maintained 
by the Director of the Federal Housing Finance Agency (pursu-
ant to section 1322 of the Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 (12 U.S.C. 4541)). If 
the change in such house price index during the most recent 
12-month or 4-quarter period ending before the time of deter-
mining such annual adjustment is a decrease, then no adjust-
ment shall be made for the next year, and the next adjustment 
shall take into account prior declines in the house price index, 
so that any adjustment shall reflect the net change in the 
Effective dates. 
Deadline. 
Notification. 
Regulations. 
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122 STAT. 2692 
PUBLIC LAW 110–289—JULY 30, 2008 
house price index since the last adjustment. Declines in the 
house price index shall be accumulated and then reduce 
increases until subsequent increases exceed prior declines.’’. 
(2) HIGH-COST AREA LIMIT.—Section 302(b)(2) of the Federal 
National Mortgage Association Charter Act (12 U.S.C. 
1717(b)(2)) is amended by adding after the period at the end 
the following: ‘‘Such foregoing limitations shall also be 
increased, with respect to properties of a particular size located 
in any area for which 115 percent of the median house price 
for such size residence exceeds the foregoing limitation for 
such size residence, to the lesser of 150 percent of such limita-
tion for such size residence or the amount that is equal to 
115 percent of the median house price in such area for such 
size residence.’’. 
(3) EFFECTIVE
DATE.—The amendments made by para-
graphs (1) and (2) of this subsection shall take effect upon 
the expiration of the date described in section 201(a) of the 
Economic Stimulus Act of 2008 (Public Law 110–185). 
(b) FREDDIE MAC.— 
(1) GENERAL LIMIT.—Section 305(a)(2) of the Federal Home 
Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) is 
amended by striking the 6th and 7th sentences and inserting 
the following new sentences: ‘‘Such limitations shall not exceed 
$417,000 for a mortgage secured by a single-family residence, 
$533,850 for a mortgage secured by a 2-family residence, 
$645,300 for a mortgage secured by a 3-family residence, and 
$801,950 for a mortgage secured by a 4-family residence, except 
that such maximum limitations shall be adjusted effective 
January 1 of each year beginning after the effective date of 
the Federal Housing Finance Regulatory Reform Act of 2008, 
subject to the limitations in this paragraph. Each adjustment 
shall be made by adding to each such amount (as it may 
have been previously adjusted) a percentage thereof equal to 
the percentage increase, during the most recent 12-month or 
4-quarter period ending before the time of determining such 
annual adjustment, in the housing price index maintained by 
the Director of the Federal Housing Finance Agency (pursuant 
to section 1322 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4541)). If the 
change in such house price index during the most recent 12- 
month or 4-quarter period ending before the time of determining 
such annual adjustment is a decrease, then no adjustment 
shall be made for the next year, and the next adjustment 
shall take into account prior declines in the house price index, 
so that any adjustment shall reflect the net change in the 
house price index since the last adjustment. Declines in the 
house price index shall be accumulated and then reduce 
increases until subsequent increases exceed prior declines.’’. 
(2) HIGH-COST AREA LIMIT.—Section 305(a)(2) of the Federal 
Home Loan Mortgage Corporation Act (12 U.S.C. 1454(a)(2)) 
is amended by adding after the period at the end the following: 
‘‘Such foregoing limitations shall also be increased, with respect 
to properties of a particular size located in any area for which 
115 percent of the median house price for such size residence 
exceeds the foregoing limitation for such size residence, to 
Effective dates. 
12 USC 1717 
note. 
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122 STAT. 2693 
PUBLIC LAW 110–289—JULY 30, 2008 
the lesser of 150 percent of such limitation for such size resi-
dence or the amount that is equal to 115 percent of the median 
house price in such area for such size residence.’’. 
(3) EFFECTIVE
DATE.—The amendments made by para-
graphs (1) and (2) of this subsection shall take effect upon 
the expiration of the date described in section 201(a) of the 
Economic Stimulus Act of 2008 (Public Law 110–185). 
(c) SENSE OF CONGRESS.—It is the sense of the Congress that 
the securitization of mortgages by the Federal National Mortgage 
Association and the Federal Home Loan Mortgage Corporation plays 
an important role in providing liquidity to the United States housing 
markets. Therefore, the Congress encourages the Federal National 
Mortgage Association and the Federal Home Loan Mortgage Cor-
poration to securitize mortgages acquired under the increased con-
forming loan limits established under this Act. 
(d) HOUSING PRICE INDEX.—Part 2 of subtitle A of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4541 et seq.) is amended by inserting after section 
1321 (as added by section 1123 of this Act) the following new 
section: 
‘‘SEC. 1322. HOUSING PRICE INDEX. 
‘‘The Director shall establish and maintain a method of 
assessing the national average 1-family house price for use for 
adjusting the conforming loan limitations of the enterprises. In 
establishing such method, the Director shall take into consideration 
the monthly survey of all major lenders conducted by the Federal 
Housing Finance Agency to determine the national average 1-family 
house price, the House Price Index maintained by the Office of 
Federal Housing Enterprise Oversight of the Department of 
Housing and Urban Development before the effective date of the 
Federal Housing Finance Regulatory Reform Act of 2008, any appro-
priate house price indexes of the Bureau of the Census of the 
Department of Commerce, and any other indexes or measures that 
the Director considers appropriate.’’. 
SEC. 1125. ANNUAL HOUSING REPORT. 
(a) REPEAL.—Section 1324 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4544) is 
hereby repealed. 
(b) ANNUAL HOUSING REPORT.—The Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 is amended 
by inserting after section 1323 the following: 
‘‘SEC. 1324. ANNUAL HOUSING REPORT. 
‘‘(a) IN GENERAL.—After reviewing and analyzing the reports 
submitted under section 309(n) of the Federal National Mortgage 
Association Charter Act and section 307(f) of the Federal Home 
Loan Mortgage Corporation Act, the Director shall submit a report, 
not later than October 30 of each year, to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the Com-
mittee on Financial Services of the House of Representatives, on 
the activities of each enterprise. 
‘‘(b) CONTENTS.—The report required under subsection (a) 
shall— 
‘‘(1) discuss— 
‘‘(A) the extent to and manner in which— 
12 USC 4544. 
Assessments. 
12 USC 4542. 
12 USC 1454 
note. 
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122 STAT. 2694 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) each enterprise is achieving the annual housing 
goals established under subpart B; 
‘‘(ii) each enterprise is complying with its duty 
to serve underserved markets, as established under 
section 1335; 
‘‘(iii) each enterprise is complying with section 
1337; 
‘‘(iv) each enterprise received credit towards 
achieving each of its goals resulting from a transaction 
or activity pursuant to section 1331(b)(2); and 
‘‘(v) each enterprise is achieving the purposes of 
the enterprise established by law; and 
‘‘(B) the actions that each enterprise could undertake 
to promote and expand the purposes of the enterprise; 
‘‘(2) aggregate and analyze relevant data on income to 
assess the compliance of each enterprise with the housing goals 
established under subpart B; 
‘‘(3) aggregate and analyze data on income, race, and gender 
by census tract and other relevant classifications, and compare 
such data with larger demographic, housing, and economic 
trends; 
‘‘(4) identify the extent to which each enterprise is involved 
in mortgage purchases and secondary market activities 
involving subprime and nontraditional loans; 
‘‘(5) compare the characteristics of subprime and nontradi-
tional loans both purchased and securitized by each enterprise 
to other loans purchased and securitized by each enterprise; 
and 
‘‘(6) compare the characteristics of high-cost loans pur-
chased and securitized, where such securities are not held 
on portfolio to loans purchased and securitized, where such 
securities are either retained on portfolio or repurchased by 
the enterprise, including such characteristics as— 
‘‘(A) the purchase price of the property that secures 
the mortgage; 
‘‘(B) the loan-to-value ratio of the mortgage, which 
shall reflect any secondary liens on the relevant property; 
‘‘(C) the terms of the mortgage; 
‘‘(D) the creditworthiness of the borrower; and 
‘‘(E) any other relevant data, as determined by the 
Director. 
‘‘(c) DATA COLLECTION AND REPORTING.— 
‘‘(1) IN GENERAL.—To assist the Director in analyzing the 
matters described in subsection (b), the Director shall conduct, 
on a monthly basis, a survey of mortgage markets in accordance 
with this subsection. 
‘‘(2) DATA POINTS.—Each monthly survey conducted by the 
Director under paragraph (1) shall collect data on— 
‘‘(A) the characteristics of individual mortgages that 
are eligible for purchase by the enterprises and the 
characteristics of individual mortgages that are not eligible 
for purchase by the enterprises including, in both cases, 
information concerning— 
‘‘(i) the price of the house that secures the mort-
gage; 
Deadlines. 
Surveys. 
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122 STAT. 2695 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) the loan-to-value ratio of the mortgage, which 
shall reflect any secondary liens on the relevant prop-
erty; 
‘‘(iii) the terms of the mortgage; 
‘‘(iv) the creditworthiness of the borrower or bor-
rowers; and 
‘‘(v) whether the mortgage, in the case of a con-
forming mortgage, was purchased by an enterprise; 
‘‘(B) the characteristics of individual subprime and non-
traditional mortgages that are eligible for purchase by the 
enterprises and the characteristics of borrowers under such 
mortgages, including the creditworthiness of such bor-
rowers and determination whether such borrowers would 
qualify for prime lending; and 
‘‘(C) such other matters as the Director determines 
to be appropriate. 
‘‘(3) PUBLIC AVAILABILITY.—The Director shall make any 
data collected by the Director in connection with the conduct 
of a monthly survey available to the public in a timely manner, 
provided that the Director may modify the data released to 
the public to ensure that the data— 
‘‘(A) is not released in an identifiable form; and 
‘‘(B) is not otherwise obtainable from other publicly 
available data sets. 
‘‘(4) DEFINITION.—For purposes of this subsection, the term 
‘identifiable form’ means any representation of information that 
permits the identity of a borrower to which the information 
relates to be reasonably inferred by either direct or indirect 
means.’’. 
SEC. 1126. PUBLIC USE DATABASE. 
Section 1323 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (42 U.S.C. 4543) is amended— 
(1) in subsection (a)— 
(A) by striking ‘‘(a) IN GENERAL.—The Secretary’’ and 
inserting the following: 
‘‘(a) AVAILABILITY.— 
‘‘(1) IN GENERAL.—The Director’’; and 
(B) by adding at the end the following new paragraph: 
‘‘(2) CENSUS
TRACT
LEVEL
REPORTING.—Such data shall 
include the data elements required to be reported under the 
Home Mortgage Disclosure Act of 1975, at the census tract 
level.’’; 
(2) in subsection (b)(2), by inserting before the period at 
the end the following: ‘‘or with subsection (a)(2)’’; and 
(3) by adding at the end the following new subsection: 
‘‘(d) TIMING.—Data submitted under this section by an enter-
prise in connection with a provision referred to in subsection (a) 
shall be made publicly available in accordance with this section 
not later than September 30 of the year following the year to 
which the data relates.’’. 
SEC. 1127. REPORTING OF MORTGAGE DATA. 
Section 1326 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4546) is amended— 
(1) in subsection (a), by striking ‘‘The Director’’ and 
inserting ‘‘Subject to subsection (d), the Director’’; and 
(2) by adding at the end the following: 
Deadline. 
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122 STAT. 2696 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(d) MORTGAGE INFORMATION.—Subject to privacy consider-
ations, as described in section 304(j) of the Home Mortgage Disclo-
sure Act of 1975 (12 U.S.C. 2803(j)), the Director shall, by regulation 
or order, provide that certain information relating to single family 
mortgage data of the enterprises shall be disclosed to the public, 
in order to make available to the public— 
‘‘(1) the same data from the enterprises that is required 
of insured depository institutions under the Home Mortgage 
Disclosure Act of 1975; and 
‘‘(2) information collected by the Director under section 
1324(b)(6).’’. 
SEC. 1128. REVISION OF HOUSING GOALS. 
(a) REPEAL.—Sections 1331 through 1334 of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4561 through 4564) are hereby repealed. 
(b) HOUSING GOALS.—The Federal Housing Enterprises Finan-
cial Safety and Soundness Act of 1992 is amended by inserting 
before section 1335 the following: 
‘‘SEC. 1331. ESTABLISHMENT OF HOUSING GOALS. 
‘‘(a) IN GENERAL.—The Director shall, by regulation, establish 
effective for 2010 and each year thereafter, annual housing goals, 
with respect to the mortgage purchases by the enterprises, as 
follows: 
‘‘(1) SINGLE-FAMILY
HOUSING
GOALS.—Four single-family 
housing goals under section 1332. 
‘‘(2) MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL.— 
One multifamily special affordable housing goal under section 
1333. 
‘‘(b) TIMING.—The Director shall, by regulation, establish an 
annual deadline by which the Director shall establish the annual 
housing goals under this subpart for each year, taking into consider-
ation the need for the enterprises to reasonably and sufficiently 
plan their operations and activities in advance, including operations 
and activities necessary to meet such annual goals. 
‘‘(c) TRANSITION.—The annual housing goals effective for 2008 
pursuant to this subpart, as in effect before the enactment of 
the Federal Housing Finance Regulatory Reform Act of 2008, shall 
remain in effect for 2009, except that not later than the expiration 
of the 270-day period beginning on the date of the enactment 
of such Act, the Director shall review such goals applicable for 
2009 to determine the feasibility of such goals given the market 
conditions current at such time and, after seeking public comment 
for a period not to exceed 30 days, may make appropriate adjust-
ments consistent with such market conditions. 
‘‘(d) ELIMINATING INTEREST RATE DISPARITIES.— 
‘‘(1) IN GENERAL.—Upon request by the Director, an enter-
prise shall provide to the Director, in a form determined by 
the Director, data the Director may review to determine 
whether there exist disparities in interest rates charged on 
mortgages to borrowers who are minorities as compared with 
comparable mortgages to borrowers of similar creditworthiness 
who are not minorities. 
‘‘(2) REMEDIAL ACTIONS UPON PRELIMINARY FINDING.—Upon 
a preliminary finding by the Director that a pattern of dispari-
ties in interest rates with respect to any lender or lenders 
Records. 
Deadline. 
Review. 
Deadline. 
Regulations. 
Regulations. 
Effective date. 
12 USC 4561. 
Public 
information. 
Regulations. 
Order. 
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122 STAT. 2697 
PUBLIC LAW 110–289—JULY 30, 2008 
exists pursuant to the data provided by an enterprise in para-
graph (1), the Director shalll 
‘‘(A) refer the preliminary finding to the appropriate 
regulatory or enforcement agency for further review; and 
‘‘(B) require the enterprise to submit additional data 
with respect to any lender or lenders, as appropriate and 
to the extent practicable, to the Director who shall submit 
any such additional data to the regulatory or enforcement 
agency for appropriate action. 
‘‘(3) ANNUAL
REPORT
TO
CONGRESS.—The Director shall 
submit to the Committee on Financial Services of the House 
of Representatives and the Committee on Banking, Housing, 
and Urban Affairs of the Senate a report describing the actions 
taken, and being taken, by the Director to carry out this sub-
section. No such report shall identify any lender or lenders 
who have not been found to have engaged in discriminatory 
lending practices pursuant to a final adjudication on the record, 
and after opportunity for an administrative hearing, in accord-
ance with subchapter II of chapter 5 of title 5, United States 
Code. 
‘‘(4) PROTECTION OF IDENTITY OF INDIVIDUALS.—In carrying 
out this subsection, the Director shall ensure that no property- 
related or financial information that would enable a borrower 
to be identified shall be made public. 
‘‘SEC. 1332. SINGLE-FAMILY HOUSING GOALS. 
‘‘(a) IN GENERAL.—The Director shall, by regulation, establish 
annual goals for the purchase by each enterprise of the following 
types of mortgages for the following categories of families: 
‘‘(1) PURCHASE-MONEY MORTGAGES.—A goal for purchase 
of conventional, conforming, single-family, purchase money 
mortgages financing owner-occupied housing for each of the 
following categories of families: 
‘‘(A) Low-income families. 
‘‘(B) Families that reside in low-income areas. 
‘‘(C) Very low-income families. 
‘‘(2) REFINANCING
MORTGAGES.—A goal for purchase of 
conventional, conforming mortgages on owner-occupied, single- 
family housing for low-income families that are given to pay 
off or prepay an existing loan secured by the same property. 
‘‘(b) GOALS
AS
A PERCENTAGE
OF TOTAL MORTGAGE PUR-
CHASES.—The goals established under paragraphs (1) and (2) of 
subsection (a) shall be established as a percentage of the total 
number of conventional, conforming, single-family, owner-occupied, 
purchase money mortgages purchased by the enterprise, or as 
percentage of the total number of conventional, single-family, owner- 
occupied refinance mortgages purchased by the enterprise, as 
applicable, that are mortgages for the types of families specified 
in paragraphs (1) and (2) of subsection (a). 
‘‘(c) 
SINGLE-FAMILY, 
OWNER-OCCUPIED
RENTAL
HOUSING 
UNITS.—The Director shall require each enterprise to report the 
number of rental housing units affordable to low-income families 
each year which are contained in mortgages purchased by the 
enterprise financing 2- to 4-unit single-family, owner-occupied prop-
erties and may, by regulation, establish additional requirements 
relating to such units. 
‘‘(d) DETERMINATION OF COMPLIANCE.— 
Reports. 
Deadline. 
Regulations. 
12 USC 4562. 
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122 STAT. 2698 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) IN GENERAL.—The Director shall determine, for each 
year that the housing goals under this section are in effect 
pursuant to section 1331(a), whether each enterprise has com-
plied with each such goal established under subsection (a) 
of this section and any additional requirements which may 
be established under subsection (c) of this section. 
‘‘(2) PURCHASE-MONEY
MORTGAGE
GOALS.—An enterprise 
shall be considered to be in compliance with a housing goal 
under subparagraph (A), (B), or (C) of subsection (a)(1) for 
a year only if, for the type of family described in such subpara-
graph, the percentage of the number of conventional, con-
forming, single-family, owner-occupied, purchase money mort-
gages purchased by the enterprise in such year that serve 
such families, meets or exceeds the target for the year for 
such type of family that is established under subsection (e). 
‘‘(3) REFINANCE GOAL.—An enterprise shall be considered 
to be in compliance with the refinance goal under subsection 
(a)(2) for a year only if the percentage of the number of conven-
tional, conforming, single-family, owner-occupied refinance 
mortgages purchased by the enterprise in such year that serve 
low-income families meets or exceeds the target for the year 
that is established under subsection (e). 
‘‘(e) ANNUAL TARGETS.— 
‘‘(1) IN GENERAL.—The Director shall, by regulation, estab-
lish annual targets for each goal and subgoal under this section, 
provided that the Director shall not set prospective targets 
longer than three years. In establishing such targets, the 
Director shall not consider segments of the market determined 
to be unacceptable or contrary to good lending practices, incon-
sistent with safety and soundness, or unauthorized for purchase 
by the enterprises. 
‘‘(2) GOALS TARGETS.— 
‘‘(A) CALCULATION.—The Director shall calculate, for 
each of the types of families described in subsection (a), 
the percentage, for each of the three years that most 
recently precede such year and for which information under 
the Home Mortgage Disclosure Act of 1975 is publicly avail-
able— 
‘‘(i) of the number of conventional, conforming, 
single-family, owner-occupied purchase money mort-
gages originated in such year that serve such type 
of family, or 
‘‘(ii) the number of conventional, conforming, 
single-family, 
owner-occupied 
refinance 
mortgages 
originated in such year that serve low-income families, 
as applicable, as determined by the Director using the 
information obtained and determined pursuant to para-
graphs (4) and (5). 
‘‘(B) ESTABLISHMENT OF GOAL TARGETS.—The Director 
shall, by regulation, establish targets for each of the goal 
categories, taking into consideration the calculations under 
subparagraph (A) and the following factors: 
‘‘(i) National housing needs. 
‘‘(ii) Economic, housing, and demographic condi-
tions, including expected market developments. 
Regulations. 
Regulations. 
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122 STAT. 2699 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iii) The performance and effort of the enterprises 
toward achieving the housing goals under this section 
in previous years. 
‘‘(iv) The ability of the enterprise to lead the 
industry in making mortgage credit available. 
‘‘(v) Such other reliable mortgage data as may 
be available. 
‘‘(vi) The size of the purchase money conventional 
mortgage market, or refinance conventional mortgage 
market, as applicable, serving each of the types of 
families described in subsection (a), relative to the 
size of the overall purchase money mortgage market 
or the overall refinance mortgage market, respectively. 
‘‘(vii) The need to maintain the sound financial 
condition of the enterprises. 
‘‘(3) AUTHORITY TO ADJUST TARGETS.—The Director may, 
by regulation, adjust the percentage targets previously estab-
lished by regulation pursuant to paragraph (2)(B) for any year, 
to reflect subsequent available data and market developments. 
‘‘(4) HMDA INFORMATION.—The Director shall annually 
obtain information submitted in compliance with the Home 
Mortgage Disclosure Act of 1975 regarding conventional, con-
forming, single-family, owner-occupied, purchase money and 
refinance mortgages originated and purchased for the previous 
year. 
‘‘(5) CONFORMING MORTGAGES.—In determining whether a 
mortgage is a conforming mortgage for purposes of this para-
graph, the Director shall consider the original principal balance 
of the mortgage loan to be the principal balance as reported 
in the information referred to in paragraph (4), as rounded 
to the nearest thousand dollars. 
‘‘(f) NOTICE OF DETERMINATION AND ENTERPRISE COMMENT.— 
‘‘(1) NOTICE.—Within 30 days of making a determination 
under subsection (d) regarding compliance of an enterprise 
for a year with a housing goal established under this section 
and before any public disclosure thereof, the Director shall 
provide notice of the determination to the enterprise, which 
shall include an analysis and comparison, by the Director, 
of the performance of the enterprise for the year and the 
targets for the year under subsection (e). 
‘‘(2) COMMENT PERIOD.—The Director shall provide each 
enterprise an opportunity to comment on the determination 
during the 30-day period beginning upon receipt by the enter-
prise of the notice. 
‘‘(g) USE OF BORROWER INCOME.—In monitoring the perform-
ance of each enterprise pursuant to the housing goals under this 
section and evaluating such performance (for purposes of section 
1336), the Director shall consider a mortgagor’s income to be such 
income at the time of origination of the mortgage. 
‘‘(h) CONSIDERATION
OF PROPERTIES WITH RENTAL UNITS.— 
Mortgages financing two- to four-unit owner-occupied properties 
shall count toward the achievement of the single-family housing 
goals under this section, if such properties otherwise meet the 
requirements under this section, notwithstanding the use of one 
or more units for rental purposes. 
‘‘(i) GOALS CREDIT.—The Director shall determine whether an 
enterprise shall receive full, partial, or no credit for a transaction 
Deadline. 
Deadline. 
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122 STAT. 2700 
PUBLIC LAW 110–289—JULY 30, 2008 
toward achievement of any of the housing goals established pursu-
ant to section 1332 and 1333. In making any such determination, 
the Director shall consider whether a transaction or activity of 
an enterprise is substantially equivalent to a mortgage purchase 
and either (1) creates a new market, or (2) adds liquidity to an 
existing market. No credit toward the achievement of the housing 
goals and subgoals established under this section may be given 
to the purchase of mortgages, including any transaction or activity 
of an enterprise determined to be substantially equivalent to a 
mortgage purchase, that is determined to be unacceptable or con-
trary to good lending practices, inconsistent with safety and sound-
ness, or unauthorized for purchase by the enterprises, pursuant 
to regulations issued by the Director. 
‘‘SEC. 1333. MULTIFAMILY SPECIAL AFFORDABLE HOUSING GOAL. 
‘‘(a) ESTABLISHMENT OF GOAL.— 
‘‘(1) IN GENERAL.—The Director shall, by regulation, estab-
lish a single annual goal, by either unit or dollar volume, 
of purchases by each enterprise of mortgages on multifamily 
housing that finance dwelling units affordable to low-income 
families. 
‘‘(2) ADDITIONAL REQUIREMENTS FOR UNITS AFFORDABLE TO 
VERY LOW-INCOME FAMILIES.—When establishing the goal under 
this section, the Director shall establish additional require-
ments for the purchase by each enterprise of mortgages on 
multifamily housing that finance dwelling units affordable to 
very low-income families. 
‘‘(3) REPORTING
ON
SMALLER
PROPERTIES.—The Director 
shall require each enterprise to report on the purchase by 
each enterprise of multifamily housing of a smaller or limited 
size that is affordable to low-income families, which may be 
based on multifamily projects of 5 to 50 units (as such numbers 
may be adjusted by the Director) or on mortgages of up to 
$5,000,000 (as such amount may be adjusted by the Director), 
and may, by regulation, establish such aditional requirements 
related to such units. 
‘‘(4) FACTORS.—In establishing the goal and additional 
requirements under this section, the Director shall not consider 
segments of the market determined to be inconsistent with 
safety and soundness or unauthorized for purchase by the 
enterprises, and shall take into consideration— 
‘‘(A) national multifamily mortgage credit needs and 
the ability of the enterprise to provide additional liquidity 
and stability for the multifamily mortgage market; 
‘‘(B) the performance and effort of the enterprise in 
making mortgage credit available for multifamily housing 
in previous years; 
‘‘(C) the size of the multifamily mortgage market for 
housing affordable to low-income and very low-income fami-
lies, including the size of the multifamily markets for 
housing of a smaller or limited size; 
‘‘(D) the ability of the enterprise to lead the market 
in making multifamily mortgage credit available, especially 
for multifamily housing described in paragraphs (1) and 
(2); 
‘‘(E) the availability of public subsidies; and 
Regulations. 
12 USC 4563. 
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122 STAT. 2701 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(F) the need to maintain the sound financial condition 
of the enterprise. 
‘‘(b) UNITS FINANCED BY HOUSING FINANCE AGENCY BONDS.— 
The Director shall give full credit toward the achievement of the 
multifamily special affordable housing goal under this section (for 
purposes of section 1336) to dwelling units in multifamily housing 
that otherwise qualifies under such goal and that is financed by 
tax-exempt or taxable bonds issued by a State or local housing 
finance agency, if such bonds, in whole or in part— 
‘‘(1) are secured by a guarantee of the enterprise; or 
‘‘(2) are purchased by the enterprise, except that the 
Director may give less than full credit for purchases of invest-
ment grade bonds, to the extent that such purchases do not 
provide a new market or add liquidity to an existing market. 
‘‘(c) MEASUREMENT OF PERFORMANCE.—The Director shall mon-
itor the performance of each enterprise in meeting the goals estab-
lished under this section and shall evaluate such performance (for 
purposes of section 1336) based on whether the rent levels are 
affordable. A rent level shall be considered to be affordable for 
purposes of this subsection for low-income families if it does not 
exceed 30 percent of the maximum income level of such income 
category, with appropriate adjustments for unit size as measured 
by the number of bedrooms. 
‘‘(d) DETERMINATION OF COMPLIANCE.—The Director shall deter-
mine, for each year that the housing goal under this section is 
in effect pursuant to section 1331(a), whether each enterprise has 
complied with such goal and the additional requirements under 
subsection (a)(2). 
‘‘SEC. 1334. DISCRETIONARY ADJUSTMENT OF HOUSING GOALS. 
‘‘(a) AUTHORITY.—An enterprise may petition the Director in 
writing at any time during a year to reduce the level of any 
goal or subgoal for such year established pursuant to this subpart. 
‘‘(b) STANDARD FOR REDUCTION.—The Director may reduce the 
level for a goal or subgoal pursuant to such a petition only if— 
‘‘(1) market and economic conditions or the financial condi-
tion of the enterprise require such action; or 
‘‘(2) efforts to meet the goal or subgoal would result in 
the constraint of liquidity, over-investment in certain market 
segments, or other consequences contrary to the intent of this 
subpart, or section 301(3) of the Federal National Mortgage 
Association Charter Act (12 U.S.C. 1716(3)) or section 301(b)(3) 
of the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
1451 note), as applicable. 
‘‘(c) DETERMINATION.—The Director shall, promptly upon receipt 
of a petition regarding a reduction, seek public comment on the 
reduction for a period of 30 days. The Director shall make a deter-
mination regarding any proposed reduction within 30 days after 
the expiration of such public comment period. The Director may 
extend such determination period for a single additional 15-day 
period, but only if the Director requests additional information 
from the enterprise.’’. 
(c) CONFORMING AMENDMENTS.—The Housing and Community 
Development Act of 1992 is amendedl 
(1) in section 1335(a) (12 U.S.C. 4565(a)), in the matter 
preceding paragraph (1), by striking ‘‘low- and moderate-income 
Deadline. 
Public comment. 
12 USC 4564. 
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122 STAT. 2702 
PUBLIC LAW 110–289—JULY 30, 2008 
housing goal’’ and all that follows through ‘‘section 1334’’ and 
inserting ‘‘housing goals established under this subpart’’; and 
(2) in section 1336(a)(1) (12 U.S.C. 4566(a)(1)), by striking 
‘‘sections 1332, 1333, and 1334,’’ and inserting ‘‘this subpart’’. 
(d) DEFINITIONS.—Section 1303 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4502) 
is amended— 
(1) by striking paragraph (24), as so designated by section 
1002 of this Act, and inserting the following: 
‘‘(24) VERY LOW-INCOME.— 
‘‘(A) IN GENERAL.—The term ‘very low-income’ means— 
‘‘(i) in the case of owner-occupied units, families 
having incomes not greater than 50 percent of the 
area median income; and 
‘‘(ii) in the case of rental units, families having 
incomes not greater than 50 percent of the area median 
income, with adjustments for smaller and larger fami-
lies, as determined by the Director. 
‘‘(B) RULE OF CONSTRUCTION.—For purposes of section 
1338 and 1339, the term ‘very low-income’ means— 
‘‘(i) in the case of owner-occupied units, income 
in excess of 30 percent but not greater than 50 percent 
of the area median income; and 
‘‘(ii) in the case of rental units, income in excess 
of 30 percent but not greater than 50 percent of the 
area median income, with adjustments for smaller and 
larger families, as determined by the Director.’’; and 
(2) by adding at the end the following: 
‘‘(26) CONFORMING MORTGAGE.—The term ‘conforming mort-
gage’ means, with respect to an enterprise, a conventional 
mortgage having an original principal obligation that does not 
exceed the dollar amount limitation in effect at the time of 
such origination and applicable to such mortgage, under, as 
applicable— 
‘‘(A) section 302(b)(2) of the Federal National Mortgage 
Association Charter Act; or 
‘‘(B) section 305(a)(2) of the Federal Home Loan Mort-
gage Corporation Act. 
‘‘(27) EXTREMELY LOW-INCOME.—The term ‘extremely low- 
income’ means— 
‘‘(A) in the case of owner-occupied units, income not 
in excess of 30 percent of the area median income; and 
‘‘(B) in the case of rental units, income not in excess 
of 30 percent of the area median income, with adjustments 
for smaller and larger families, as determined by the 
Director. 
‘‘(28) LOW-INCOME
AREA.—The term ‘low-income area’ 
means a census tract or block numbering area in which the 
median income does not exceed 80 percent of the median income 
for the area in which such census tract or block numbering 
area is located, and, for the purposes of section 1332(a)(1)(B), 
shall include families having incomes not greater than 100 
percent of the area median income who reside in minority 
census tracts and shall include families having incomes not 
greater than 100 percent of the area median income who reside 
in designated disaster areas. 
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122 STAT. 2703 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(29) MINORITY CENSUS TRACT.—The term ‘minority census 
tract’ means a census tract that has a minority population 
of at least 30 percent and a median family income of less 
than 100 percent of the area family median income. 
‘‘(30) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORD-
ABLE
AND
AVAILABLE
TO
EXTREMELY
LOW-INCOME
RENTER 
HOUSEHOLDS.— 
‘‘(A) IN
GENERAL.—The term ‘shortage of standard 
rental units both affordable and available to extremely 
low-income renter households’ means the gap between— 
‘‘(i) the number of units with complete plumbing 
and kitchen facilities with a rent that is 30 percent 
or less of 30 percent of the adjusted area median 
income as determined by the Director that are occupied 
by extremely low-income renter households or are 
vacant for rent; and 
‘‘(ii) the number of extremely low-income renter 
households. 
‘‘(B) RULE OF CONSTRUCTION.—If the number of units 
described in subparagraph (A)(i) exceeds the number of 
extremely low-income households as described in subpara-
graph (A)(ii), there is no shortage. 
‘‘(31) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORD-
ABLE
AND
AVAILABLE
TO
VERY
LOW-INCOME
RENTER
HOUSE-
HOLDS.— 
‘‘(A) IN
GENERAL.—The term ‘shortage of standard 
rental units both affordable and available to very low- 
income renter households’ means the gap between— 
‘‘(i) the number of units with complete plumbing 
and kitchen facilities with a rent that is 30 percent 
or less of 50 percent of the adjusted area median 
income as determined by the Director that are occupied 
by either extremely low- or very low-income renter 
households or are vacant for rent; and 
‘‘(ii) the number of extremely low- and very low- 
income renter households. 
‘‘(B) RULE OF CONSTRUCTION.—If the number of units 
described in subparagraph (A)(i) exceeds the number of 
extremely low- and very low-income households as 
described in subparagraph (A)(ii), there is no shortage.’’. 
SEC. 1129. DUTY TO SERVE UNDERSERVED MARKETS. 
(a) ESTABLISHMENT AND EVALUATION OF PERFORMANCE.—Sec-
tion 1335 of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992 (12 U.S.C. 4565) is amended— 
(1) in the section heading, by inserting ‘‘DUTY TO SERVE 
UNDERSERVED MARKETS AND’’ before ‘‘OTHER’’; 
(2) by striking subsection (b); 
(3) in subsection (a)— 
(A) in the matter preceding paragraph (1), by inserting 
‘‘and to carry out the duty under subsection (a) of this 
section’’ before ‘‘, each enterprise shall’’; 
(B) in paragraph (3), by inserting ‘‘and’’ after the semi-
colon at the end; 
(C) in paragraph (4), by striking ‘‘; and’’ and inserting 
a period; 
(D) by striking paragraph (5); and 
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122 STAT. 2704 
PUBLIC LAW 110–289—JULY 30, 2008 
(E) by redesignating such subsection as subsection (b); 
(4) by inserting before subsection (b) (as so redesignated 
by paragraph (3)(E) of this subsection) the following new sub-
section: 
‘‘(a) DUTY TO SERVE UNDERSERVED MARKETS.— 
‘‘(1) DUTY.—To increase the liquidity of mortgage invest-
ments and improve the distribution of investment capital avail-
able for mortgage financing for underserved markets, each 
enterprise shall provide leadership to the market in developing 
loan products and flexible underwriting guidelines to facilitate 
a secondary market for mortgages for very low-, low-, and 
moderate-income families with respect to the following under-
served markets: 
‘‘(A) MANUFACTURED HOUSING.—The enterprise shall 
develop loan products and flexible underwriting guidelines 
to facilitate a secondary market for mortgages on manufac-
tured homes for very low-, low-, and moderate-income fami-
lies. 
‘‘(B) AFFORDABLE HOUSING PRESERVATION.—The enter-
prise shall develop loan products and flexible underwriting 
guidelines to facilitate a secondary market to preserve 
housing affordable to very low-, low-, and moderate-income 
families, including housing projects subsidized underl 
‘‘(i) the project-based and tenant-based rental 
assistance programs under section 8 of the United 
States Housing Act of 1937; 
‘‘(ii) the program under section 236 of the National 
Housing Act; 
‘‘(iii) the below-market interest rate mortgage pro-
gram under section 221(d)(4) of the National Housing 
Act; 
‘‘(iv) the supportive housing for the elderly pro-
gram under section 202 of the Housing Act of 1959; 
‘‘(v) the supportive housing program for persons 
with disabilities under section 811 of the Cranston- 
Gonzalez National Affordable Housing Act; 
‘‘(vi) the programs under title IV of the McKinney- 
Vento Homeless Assistance Act (42 U.S.C. 11361 et 
seq.), but only permanent supportive housing projects 
subsidized under such programs; 
‘‘(vii) the rural rental housing program under sec-
tion 515 of the Housing Act of 1949; 
‘‘(viii) the low-income housing tax credit under sec-
tion 42 of the Internal Revenue Code of 1986; and 
‘‘(ix) comparable state and local affordable housing 
programs. 
‘‘(C) RURAL
MARKETS.—The enterprise shall develop 
loan products and flexible underwriting guidelines to facili-
tate a secondary market for mortgages on housing for very 
low-, and low-, and moderate-income families in rural 
areas.’’; and 
(5) by adding at the end the following new subsections: 
‘‘(c) ADDITIONAL CATEGORIES.—The Director may submit rec-
ommendations to the Committee on Financial Services of the House 
of Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate for the establishment of additional 
categories under subsection (a), provided that the Director makes 
Guidelines. 
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122 STAT. 2705 
PUBLIC LAW 110–289—JULY 30, 2008 
a preliminary determination that any such category is important 
to the mission of the enterprises, that the category is an under-
served market, and that the establishment of such category is 
warranted. 
‘‘(d) EVALUATION AND REPORTING OF COMPLIANCE.— 
‘‘(1) IN GENERAL.—The Director shall, by regulation, estab-
lish effective for 2010 and thereafter a manner for evaluating 
whether, and the extent to which, the enterprises have complied 
with the duty under subsection (a) to serve underserved mar-
kets and for rating the extent of such compliance. Using such 
method, the Director shall, for 2010 and each year thereafter, 
evaluate such compliance and rate the performance of each 
enterprise as to extent of compliance. The Director shall include 
such evaluation and rating for each enterprise for a year in 
the report for that year submitted pursuant to section 1319B(a). 
‘‘(2) SEPARATE EVALUATIONS.—In determining whether an 
enterprise has complied with the duty referred to in paragraph 
(1), the Director shall separately evaluate whether the enter-
prise has complied with such duty with respect to each of 
the underserved markets identified in subsection (a), taking 
into considerationl 
‘‘(A) the development of loan products, more flexible 
underwriting guidelines, and other innovative approaches 
to providing financing to each of such underserved markets; 
‘‘(B) the extent of outreach to qualified loan sellers 
and other market participants in each of such underserved 
markets; 
‘‘(C) the volume of loans purchased in each of such 
underserved markets relative to the market opportunities 
available to the enterprise, except that the Director shall 
not establish specific quantitative targets nor evaluate the 
enterprises based solely on the volume of loans purchased; 
and 
‘‘(D) the amount of investments and grants in projects 
which assist in meeting the needs of such underserved 
markets. 
‘‘(3) MANUFACTURED
HOUSING
MARKET.—In determining 
whether an enterprise has complied with the duty under 
subparagraph (A) of subsection (a)(1), the Director may consider 
loans secured by both real and personal property. 
‘‘(4) PROHIBITION
OF
CONSIDERATION
OF
AFFORDABLE 
HOUSING FUND GRANTS FOR MEETING DUTY TO SERVE.— In deter-
mining whether an enterprise has complied with the duty 
referred to in paragraph (1), the Director may not consider 
any affordable housing fund grant amounts used under section 
1337 for eligible activities under subsection (g) of such section.’’. 
(b) ENFORCEMENT.—Subsection (a) of section 1336 of the 
Housing and Community Development Act of 1992 (12 U.S.C. 
4566(a)) is amended— 
(1) in paragraph (1), by inserting ‘‘and with the duty under 
section 1335(a) of each enterprise with respect to underserved 
markets,’’ before ‘‘as provided in this section’’; and 
(2) by adding at the end of such subsection, as amended 
by the preceding provisions of this title, the following new 
paragraph: 
‘‘(4) ENFORCEMENT OF DUTY TO PROVIDE MORTGAGE CREDIT 
TO UNDERSERVED MARKETS.—The duty under section 1335(a) 
Regulations. 
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122 STAT. 2706 
PUBLIC LAW 110–289—JULY 30, 2008 
of each enterprise to serve underserved markets (as determined 
in accordance with section 1335(c)) shall be enforceable under 
this section to the same extent and under the same provisions 
that the housing goals established under this subpart are 
enforceable. Such duty shall be enforceable only under this 
section, except that such duty shall not be subject to subsection 
(c)(7) of this section and shall not be enforceable under any 
other provision of this title (including subpart C of this part) 
or under any provision of the Federal National Mortgage 
Association Charter Act or the Federal Home Loan Mortgage 
Corporation Act.’’. 
(c) ADDITIONAL CREDIT
FOR CERTAIN MORTGAGES.—Section 
1336(a) of the Housing and Community Development Act of 1992 
(12 U.S.C. 4566(a)) is amendedl 
(1) in paragraph (2), by inserting ‘‘, except as provided 
in paragraph (5),’’ after ‘‘which’’; and 
(2) by adding at the end the following new paragraph: 
‘‘(5) ADDITIONAL CREDIT.—The Director may assign addi-
tional credit toward achievement, under this section, of the 
housing goals for mortgage purchase activities of the enterprises 
that comply with the requirements of such goals and support 
housing that includes a licensed childcare center. The avail-
ability of additional credit under this paragraph shall not be 
used to increase any housing goal, subgoal, or target established 
under this subpart.’’. 
SEC. 
1130. 
MONITORING 
AND 
ENFORCING 
COMPLIANCE 
WITH 
HOUSING GOALS. 
(a) IN GENERAL.—Section 1336 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4566) 
is amended by striking subsections (b) and (c) and inserting the 
following: 
‘‘(b) NOTICE AND PRELIMINARY DETERMINATION OF FAILURE TO 
MEET GOALS.— 
‘‘(1) NOTICE.—If the Director preliminarily determines that 
an enterprise has failed, or that there is a substantial prob-
ability that an enterprise will fail, to meet any housing goal 
under this subpart, the Director shall provide written notice 
to the enterprise of such a preliminary determination, the rea-
sons for such determination, and the information on which 
the Director based the determination. 
‘‘(2) RESPONSE PERIOD.— 
‘‘(A) IN GENERAL.—During the 30-day period beginning 
on the date on which an enterprise is provided notice 
under paragraph (1), the enterprise may submit to the 
Director any written information that the enterprise con-
siders appropriate for consideration by the Director in 
finally determining whether such failure has occurred or 
whether the achievement of such goal was or is feasible. 
‘‘(B) EXTENDED PERIOD.—The Director may extend the 
period under subparagraph (A) for good cause for not more 
than 30 additional days. 
‘‘(C) SHORTENED PERIOD.—The Director may shorten 
the period under subparagraph (A) for good cause. 
‘‘(D) FAILURE TO RESPOND.—The failure of an enterprise 
to provide information during the 30-day period under this 
paragraph (as extended or shortened) shall waive any right 
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122 STAT. 2707 
PUBLIC LAW 110–289—JULY 30, 2008 
of the enterprise to comment on the proposed determination 
or action of the Director. 
‘‘(3) CONSIDERATION
OF
INFORMATION
AND
FINAL
DETER-
MINATION.— 
‘‘(A) IN GENERAL.—After the expiration of the response 
period under paragraph (2), or upon receipt of information 
provided during such period by the enterprise, whichever 
occurs earlier, the Director shall issue a final determination 
on— 
‘‘(i) whether the enterprise has failed, or there 
is a substantial probability that the enterprise will 
fail, to meet the housing goal; and 
‘‘(ii) whether (taking into consideration market and 
economic conditions and the financial condition of the 
enterprise) the achievement of the housing goal was 
or is feasible. 
‘‘(B) CONSIDERATIONS.—In making a final determina-
tion under subparagraph (A), the Director shall take into 
consideration any relevant information submitted by the 
enterprise during the response period. 
‘‘(C) NOTICE.—The Director shall provide written 
notice, including a response to any information submitted 
during the response period, to the enterprise, the Com-
mittee on Banking, Housing, and Urban Affairs of the 
Senate, and the Committee on Financial Services of the 
House of Representatives, of— 
‘‘(i) each final determination under this paragraph 
that an enterprise has failed, or that there is a substan-
tial probability that the enterprise will fail, to meet 
a housing goal; 
‘‘(ii) each final determination that the achievement 
of a housing goal was or is feasible; and 
‘‘(iii) the reasons for each such final determination. 
‘‘(c) CEASE AND DESIST, CIVIL MONEY PENALTIES, AND REMEDIES 
INCLUDING HOUSING PLANS.— 
‘‘(1) REQUIREMENT.—If the Director finds, pursuant to sub-
section (b), that there is a substantial probability that an enter-
prise will fail, or has actually failed, to meet any housing 
goal under this subpart, and that the achievement of the 
housing goal was or is feasible, the Director may require that 
the enterprise submit a housing plan under this subsection. 
If the Director makes such a finding and the enterprise refuses 
to submit such a plan, submits an unacceptable plan, or fails 
to comply with the plan, the Director may issue a cease and 
desist order in accordance with section 1341 and impose civil 
money penalties in accordance with section 1345. 
‘‘(2) HOUSING PLAN.—If the Director requires a housing 
plan under this subsection, such a plan shall be— 
‘‘(A) a feasible plan describing the specific actions the 
enterprise will take— 
‘‘(i) to achieve the goal for the next calendar year; 
and 
‘‘(ii) if the Director determines that there is a 
substantial probability that the enterprise will fail to 
meet a goal in the current year, to make such improve-
ments and changes in its operations as are reasonable 
in the remainder of such year; and 
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122 STAT. 2708 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) sufficiently specific to enable the Director to mon-
itor compliance periodically. 
‘‘(3) DEADLINE FOR SUBMISSION.—The Director shall estab-
lish a deadline for an enterprise to submit a housing plan 
to the Director, which may not be more than 45 days after 
the enterprise is provided notice. The Director may extend 
the deadline to the extent that the Director determines nec-
essary. Any extension of the deadline shall be in writing and 
for a time certain. 
‘‘(4) APPROVAL.—The Director shall review each submission 
by an enterprise, including a housing plan submitted under 
this subsection, and, not later than 30 days after submission, 
approve or disapprove the plan or other action. The Director 
may extend the period for approval or disapproval for a single 
additional 30-day period if the Director determines it necessary. 
The Director shall approve any plan that the Director deter-
mines is likely to succeed, and conforms with the Federal 
National Mortgage Association Charter Act or the Federal 
Home Loan Mortgage Corporation Act (as applicable), this title, 
and any other applicable provision of law. 
‘‘(5) NOTICE OF APPROVAL AND DISAPPROVAL.—The Director 
shall provide written notice to any enterprise submitting a 
housing plan of the approval or disapproval of the plan (which 
shall include the reasons for any disapproval of the plan) and 
of any extension of the period for approval or disapproval. 
‘‘(6) RESUBMISSION.—If the initial housing plan submitted 
by an enterprise under this section is disapproved, the enter-
prise shall submit an amended plan acceptable to the Director 
not later than 15 days after such disapproval, or such longer 
period that the Director determines is in the public interest. 
‘‘(7) CEASE AND DESIST ORDERS; CIVIL MONEY PENALTIES.— 
Solely with respect to the housing goals established under 
sections 1332(a) and 1333(a)(1), if the Director requires an 
enterprise to submit a housing plan under this subsection and 
the enterprise refuses to submit such a plan, submits an 
unacceptable plan, or fails to comply with the plan, the Director 
may issue a cease and desist order in accordance with section 
1341, impose civil money penalties in accordance with section 
1345, exercise other appropriate enforcement authority or seek 
other appropriate actions.’’. 
(b) CONFORMING AMENDMENT.—The heading for subpart C of 
part 2 of subtitle A of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 is amended to read as follows: 
‘‘Subpart C—Enforcement’’. 
(c) CEASE AND DESIST PROCEEDINGS .— 
(1) REPEAL.—Section 1341 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4581) is hereby repealed. 
(2) CEASE AND DESIST PROCEEDINGS.—The Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 is 
amended by inserting before section 1342 the following: 
‘‘SEC. 1341. CEASE AND DESIST PROCEEDINGS. 
‘‘(a) GROUNDS
FOR ISSUANCE.—The Director may issue and 
serve a notice of charges under this section upon an enterprise 
if the Director determines that— 
12 USC 4581. 
Deadline. 
Review. 
Deadline. 
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122 STAT. 2709 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) the enterprise has failed to submit a report under 
section 1327, following a notice of such failure, an opportunity 
for comment by the enterprise, and a final determination by 
the Director; 
‘‘(2) the enterprise has failed to submit the information 
required under subsection (m) or (n) of section 309 of the 
Federal National Mortgage Association Charter Act, or sub-
section (e) or (f) of section 307 of the Federal Home Loan 
Mortgage Corporation Act; 
‘‘(3) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), the enterprise has failed 
to submit a housing plan that complies with section 1336(c) 
within the applicable period; or 
‘‘(4) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), the enterprise has failed 
to comply with a housing plan under section 1336(c). 
‘‘(b) PROCEDURE.— 
‘‘(1) NOTICE OF CHARGES.—Each notice of charges issued 
under this section shall contain a statement of the facts consti-
tuting the alleged conduct and shall fix a time and place at 
which a hearing will be held to determine on the record whether 
an order to cease and desist from such conduct should issue. 
‘‘(2) ISSUANCE
OF
ORDER.—If the Director finds on the 
record made at a hearing described in paragraph (1) that any 
conduct specified in the notice of charges has been established 
(or the enterprise consents pursuant to section 1342(a)(4)), the 
Director may issue and serve upon the enterprise an order 
requiring the enterprise to— 
‘‘(A) submit a report under section 1327; 
‘‘(B) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), submit a housing 
plan in compliance with section 1336(c); 
‘‘(C) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), comply with the 
housing plan in compliance with section 1336(c); or 
‘‘(D) provide the information required under subsection 
(m) or (n) of section 309 of the Federal National Mortgage 
Association Charter Act, or subsection (e) or (f) of section 
307 of the Federal Home Loan Mortgage Corporation Act. 
‘‘(c) EFFECTIVE DATE.—An order under this section shall become 
effective upon the expiration of the 30-day period beginning on 
the date of service of the order upon the enterprise (except in 
the case of an order issued upon consent, which shall become 
effective at the time specified therein), and shall remain effective 
and enforceable as provided in the order, except to the extent 
that the order is stayed, modified, terminated, or set aside by 
action of the Director or otherwise, as provided in this subpart.’’. 
(d) CIVIL MONEY PENALTIES.— 
(1) REPEAL.—Section 1345 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4585) is hereby repealed. 
(2) CIVIL MONEY PENALTIES.—The Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 is amended 
by inserting after section 1344 the following: 
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122 STAT. 2710 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘SEC. 1345. CIVIL MONEY PENALTIES. 
‘‘(a) AUTHORITY.—The Director may impose a civil money pen-
alty, in accordance with the provisions of this section, on any 
enterprise that has failed to— 
‘‘(1) submit a report under section 1327, following a notice 
of such failure, an opportunity for comment by the enterprise, 
and a final determination by the Director; 
‘‘(2) submit the information required under subsection (m) 
or (n) of section 309 of the Federal National Mortgage Associa-
tion Charter Act or subsection (e) or (f) of section 307 of the 
Federal Home Loan Mortgage Corporation Act; 
‘‘(3) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), submit a housing plan 
or perform its responsibilities under a remedial order issued 
pursuant to section 1336(c) within the required period; or 
‘‘(4) solely with respect to the housing goals established 
under sections 1332(a) and 1333(a)(1), comply with a housing 
plan for the enterprise under section 1336(c). 
‘‘(b) AMOUNT OF PENALTY.—The amount of a penalty under 
this section, as determined by the Director, may not exceed— 
‘‘(1) for any failure described in paragraph (1), (5), or (6) 
of subsection (a), $100,000 for each day that the failure occurs; 
and 
‘‘(2) for any failure described in paragraph (2), (3), or (4) 
of subsection (a), $50,000 for each day that the failure occurs. 
‘‘(c) PROCEDURES.— 
‘‘(1) ESTABLISHMENT.—The Director shall establish stand-
ards and procedures governing the imposition of civil money 
penalties under this section. Such standards and procedures— 
‘‘(A) shall provide for the Director to notify the enter-
prise in writing of the determination of the Director to 
impose the penalty, which shall be made on the record; 
‘‘(B) shall provide for the imposition of a penalty only 
after the enterprise has been given an opportunity for 
a hearing on the record pursuant to section 1342; and 
‘‘(C) may provide for review by the Director of any 
determination or order, or interlocutory ruling, arising from 
a hearing. 
‘‘(2) FACTORS IN DETERMINING AMOUNT OF PENALTY.—In 
determining the amount of a penalty under this section, the 
Director shall give consideration to factors including— 
‘‘(A) the gravity of the offense; 
‘‘(B) any history of prior offenses; 
‘‘(C) ability to pay the penalty; 
‘‘(D) injury to the public; 
‘‘(E) benefits received; 
‘‘(F) deterrence of future violations; 
‘‘(G) the length of time that the enterprise should 
reasonably take to achieve the goal; and 
‘‘(H) such other factors as the Director may determine, 
by regulation, to be appropriate. 
‘‘(d) ACTION TO COLLECT PENALTY.—If an enterprise fails to 
comply with an order by the Director imposing a civil money penalty 
under this section, after the order is no longer subject to review, 
as provided in sections 1342 and 1343, the Director may bring 
an action in the United States District Court for the District of 
Columbia to obtain a monetary judgment against the enterprise, 
Records. 
Standards. 
12 USC 4585. 
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122 STAT. 2711 
PUBLIC LAW 110–289—JULY 30, 2008 
and such other relief as may be available. The monetary judgment 
may, in the court’s discretion, include the attorneys’ fees and other 
expenses incurred by the United States in connection with the 
action. In an action under this subsection, the validity and appro-
priateness of the order imposing the penalty shall not be subject 
to review. 
‘‘(e) SETTLEMENT BY DIRECTOR.—The Director may compromise, 
modify, or remit any civil money penalty which may be, or has 
been, imposed under this section. 
‘‘(f) DEPOSIT OF PENALTIES.—The Director shall use any civil 
money penalties collected under this section to help fund the 
Housing Trust Fund established under section 1338.’’. 
(e) DIRECTOR AUTHORITY.— 
(1) AUTHORITY TO BRING A CIVIL ACTION.—Section 1344(a) 
of the Federal Housing Enterprises Financial Safety and Sound-
ness Act of 1992 (12 U.S.C. 4584) is amended by striking 
‘‘The Secretary may request the Attorney General of the United 
States to bring a civil action’’ and inserting ‘‘The Director 
may bring a civil action’’. 
(2) SUBPOENA ENFORCEMENT.—Section 1348(c) of the Fed-
eral Housing Enterprises Financial Safety and Soundness Act 
of 1992 (12 U.S.C. 4588(c)) is amended by inserting ‘‘may bring 
an action or’’ before ‘‘may request’’. 
(3) CONFORMING AMENDMENTS.—Subpart C of part 2 of 
subtitle A of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992 (12 U.S.C. 4581 et seq.) is amended 
by striking ‘‘Secretary’’ each place that term appears and 
inserting ‘‘Director’’ in each of— 
(A) section 1342 (12 U.S.C. 4582); 
(B) section 1343 (12 U.S.C. 4583); 
(C) section 1346 (12 U.S.C. 4586); 
(D) section 1347 (12 U.S.C. 4587); and 
(E) section 1348 (12 U.S.C. 4588). 
SEC. 1131. AFFORDABLE HOUSING PROGRAMS. 
(a) REPEAL.—Section 1337 of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4567) is 
hereby repealed. 
(b) ANNUAL HOUSING REPORT.—The Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 1301 
et seq.) is amended by inserting after section 1336 the following: 
‘‘SEC. 1337. AFFORDABLE HOUSING ALLOCATIONS. 
‘‘(a) SET ASIDE
AND ALLOCATION
OF AMOUNTS
BY ENTER-
PRISES.—Subject to subsection (b), in each fiscal year— 
‘‘(1) the Federal Home Loan Mortgage Corporation shall— 
‘‘(A) set aside an amount equal to 4.2 basis points 
for each dollar of the unpaid principal balance of its total 
new business purchases; and 
‘‘(B) allocate or otherwise transfer— 
‘‘(i) 65 percent of such amounts to the Secretary 
of Housing and Urban Development to fund the 
Housing Trust Fund established under section 1338; 
and 
‘‘(ii) 35 percent of such amounts to fund the Capital 
Magnet Fund established pursuant to section 1339; 
and 
‘‘(2) the Federal National Mortgage Association shall— 
12 USC 4567. 
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122 STAT. 2712 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) set aside an amount equal to 4.2 basis points 
for each dollar of unpaid principal balance of its total 
new business purchases; and 
‘‘(B) allocate or otherwise transfer— 
‘‘(i) 65 percent of such amounts to the Secretary 
of Housing and Urban Development to fund the 
Housing Trust Fund established under section 1338; 
and 
‘‘(ii) 35 percent of such amounts to fund the Capital 
Magnet Fund established pursuant to section 1339. 
‘‘(b) SUSPENSION OF CONTRIBUTIONS.—The Director shall tempo-
rarily suspend allocations under subsection (a) by an enterprise 
upon a finding by the Director that such allocations— 
‘‘(1) are contributing, or would contribute, to the financial 
instability of the enterprise; 
‘‘(2) are causing, or would cause, the enterprise to be classi-
fied as undercapitalized; or 
‘‘(3) are preventing, or would prevent, the enterprise from 
successfully completing a capital restoration plan under section 
1369C. 
‘‘(c) PROHIBITION OF PASS-THROUGH OF COST OF ALLOCATIONS.— 
The Director shall, by regulation, prohibit each enterprise from 
redirecting the costs of any allocation required under this section, 
through increased charges or fees, or decreased premiums, or in 
any other manner, to the originators of mortgages purchased or 
securitized by the enterprise. 
‘‘(d) ENFORCEMENT
OF
REQUIREMENTS
ON
ENTERPRISE.— 
Compliance by the enterprises with the requirements under this 
section shall be enforceable under subpart C. Any reference in 
such subpart to this part or to an order, rule, or regulation under 
this part specifically includes this section and any order, rule, 
or regulation under this section. 
‘‘(e) REQUIRED AMOUNT FOR HOPE RESERVE FUND.—Of the 
aggregate amount allocated under subsection (a), 25 percent shall 
be deposited into a fund established in the Treasury of the United 
States by the Secretary of the Treasury for such purpose. 
‘‘(f) LIMITATION.—No funds under this title may be used in 
conjunction with property taken by eminent domain, unless eminent 
domain is employed only for a public use, except that, for purposes 
of this section, public use shall not be construed to include economic 
development that primarily benefits any private entity. 
‘‘SEC. 1338. HOUSING TRUST FUND. 
‘‘(a) ESTABLISHMENT AND PURPOSE.— 
‘‘(1) IN GENERAL.—The Secretary of Housing and Urban 
Development (in this section referred to as the ‘Secretary’) 
shall establish and manage a Housing Trust Fund, which shall 
be funded with amounts allocated by the enterprises under 
section 1337 and any amounts as are or may be appropriated, 
transferred, or credited to such Housing Trust Fund under 
any other provisions of law. The purpose of the Housing Trust 
Fund under this section is to provide grants to States (as 
such term is defined in section 1303) for use— 
‘‘(A) to increase and preserve the supply of rental 
housing for extremely low- and very low-income families, 
including homeless families; and 
12 USC 4568. 
Regulations. 
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122 STAT. 2713 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) to increase homeownership for extremely low- and 
very low-income families. 
‘‘(2) FEDERAL ASSISTANCE.—For purposes of the application 
of Federal civil rights laws, all assistance provided from the 
Housing Trust Fund shall be considered Federal financial 
assistance. 
‘‘(b) ALLOCATIONS FOR HOPE BOND PAYMENTS.— 
‘‘(1) IN GENERAL.—Notwithstanding subsection (c), to help 
address the mortgage crisis, of the amounts allocated pursuant 
to clauses (i) and (ii) of section 1337(a)(1)(B) and clauses (i) 
and (ii) of section 1337(a)(2)(B) in excess of amounts described 
in section 1337(e)— 
‘‘(A) 100 percent of such excess shall be used to 
reimburse the Treasury for payments made pursuant to 
section 257(w)(1)(C) of the National Housing Act in cal-
endar year 2009; 
‘‘(B) 50 percent of such excess shall be used to 
reimburse the Treasury for such payments in calendar 
year 2010; and 
‘‘(C) 25 percent of such excess shall be used to 
reimburse the Treasury for such payments in calendar 
year 2011. 
‘‘(2) EXCESS FUNDS.—At the termination of the HOPE for 
Homeowners Program established under section 257 of the 
National Housing Act, if amounts used to reimburse the 
Treasury under paragraph (1) exceed the total net cost to 
the Government of the HOPE for Homeowners Program, such 
amounts shall be used for their original purpose, as described 
in paragraphs (1)(B) and (2)(B) of section 1337(a). 
‘‘(3) TREASURY FUND.—The amounts referred to in subpara-
graphs (A) through (C) of paragraph (1) shall be deposited 
into a fund established in the Treasury of the United States 
by the Secretary of the Treasury for such purpose. 
‘‘(c) ALLOCATION FOR HOUSING TRUST FUND IN FISCAL YEAR 
2010 AND SUBSEQUENT YEARS.— 
‘‘(1) IN GENERAL.—Except as provided in subsection (b), 
the Secretary shall distribute the amounts allocated for the 
Housing Trust Fund under this section to provide affordable 
housing as described in this subsection. 
‘‘(2) PERMISSIBLE
DESIGNEES.—A State receiving grant 
amounts under this subsection may designate a State housing 
finance agency, housing and community development entity, 
tribally designated housing entity (as such term is defined 
in section 4 of the Native American Housing Assistance and 
Self-Determination Act of 1997 (25 U.S.C. 4103)), or any other 
qualified instrumentality of the State to receive such grant 
amounts. 
‘‘(3) DISTRIBUTION TO STATES BY NEEDS-BASED FORMULA.— 
‘‘(A) IN GENERAL.—The Secretary shall, by regulation, 
establish a formula within 12 months of the date of enact-
ment of the Federal Housing Finance Regulatory Reform 
Act of 2008, to distribute amounts made available under 
this subsection to each State to provide affordable housing 
to extremely low- and very low-income households. 
‘‘(B) BASIS FOR FORMULA.—The formula required under 
subparagraph (A) shall include the following: 
Regulations. 
Deadline. 
Disadvantaged 
persons. 
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122 STAT. 2714 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) The ratio of the shortage of standard rental 
units both affordable and available to extremely low- 
income renter households in the State to the aggregate 
shortage of standard rental units both affordable and 
available to extremely low-income renter households 
in all the States. 
‘‘(ii) The ratio of the shortage of standard rental 
units both affordable and available to very low-income 
renter households in the State to the aggregate short-
age of standard rental units both affordable and avail-
able to very low-income renter households in all the 
States. 
‘‘(iii) The ratio of extremely low-income renter 
households in the State living with either (I) incom-
plete kitchen or plumbing facilities, (II) more than 
1 person per room, or (III) paying more than 50 percent 
of income for housing costs, to the aggregate number 
of extremely low-income renter households living with 
either (IV) incomplete kitchen or plumbing facilities, 
(V) more than 1 person per room, or (VI) paying more 
than 50 percent of income for housing costs in all 
the States. 
‘‘(iv) The ratio of very low-income renter house-
holds in the State paying more than 50 percent of 
income on rent relative to the aggregate number of 
very low-income renter households paying more than 
50 percent of income on rent in all the States. 
‘‘(v) The resulting sum calculated from the factors 
described in clauses (i) through (iv) shall be multiplied 
by the relative cost of construction in the State. For 
purposes of this subclause, the term ‘cost of construc-
tion’— 
‘‘(I) means the cost of construction or building 
rehabilitation in the State relative to the national 
cost of construction or building rehabilitation; and 
‘‘(II) shall be calculated such that values 
higher than 1.0 indicate that the State’s construc-
tion costs are higher than the national average, 
a value of 1.0 indicates that the State’s construc-
tion costs are exactly the same as the national 
average, and values lower than 1.0 indicate that 
the State’s cost of construction are lower than 
the national average. 
‘‘(C) PRIORITY.—The formula required under subpara-
graph (A) shall give priority emphasis and consideration 
to the factor described in subparagraph (B)(i). 
‘‘(4) ALLOCATION OF GRANT AMOUNTS.— 
‘‘(A) NOTICE.—Not later than 60 days after the date 
that the Secretary determines the formula amounts 
described in paragraph (3), the Secretary shall caused to 
be published in the Federal Register a notice that such 
amounts shall be so available. 
‘‘(B) GRANT AMOUNT.—In each fiscal year other than 
fiscal year 2009, the Secretary shall make a grant to each 
State in an amount that is equal to the formula amount 
determined under paragraph (3) for that State. 
State and local 
governments. 
Deadline. 
Federal Register, 
publication. 
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122 STAT. 2715 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) MINIMUM
STATE
ALLOCATIONS.—If the formula 
amount determined under paragraph (3) for a fiscal year 
would allocate less than $3,000,000 to any of the 50 States 
of the United States or the District of Columbia, the alloca-
tion for such State of the United States or the District 
of Columbia shall be $3,000,000, and the increase shall 
be deducted pro rata from the allocations made to all 
other of the States (as such term is defined in section 
1303). 
‘‘(5) ALLOCATION PLANS REQUIRED.— 
‘‘(A) IN GENERAL.—For each year that a State or State 
designated entity receives a grant under this subsection, 
the State or State designated entity shall establish an 
allocation plan. Such plan shall— 
‘‘(i) set forth a plan for the distribution of grant 
amounts received by the State or State designated 
entity for such year; 
‘‘(ii) be based on priority housing needs, as deter-
mined by the State or State designated entity in accord-
ance with the regulations established under subsection 
(g)(2)(D); 
‘‘(iii) comply with paragraph (6); and 
‘‘(iv) include performance goals that comply with 
the requirements established by the Secretary pursu-
ant to subsection (g)(2). 
‘‘(B) ESTABLISHMENT.—In establishing an allocation 
plan under this paragraph, a State or State designated 
entity shall— 
‘‘(i) notify the public of the establishment of the 
plan; 
‘‘(ii) provide an opportunity for public comments 
regarding the plan; 
‘‘(iii) consider any public comments received 
regarding the plan; and 
‘‘(iv) make the completed plan available to the 
public. 
‘‘(C) CONTENTS.—An allocation plan of a State or State 
designated entity under this paragraph shall set forth the 
requirements for eligible recipients under paragraph (8) 
to apply for such grant amounts, including a requirement 
that each such application include— 
‘‘(i) a description of the eligible activities to be 
conducted using such assistance; and 
‘‘(ii) a certification by the eligible recipient applying 
for such assistance that any housing units assisted 
with such assistance will comply with the requirements 
under this section. 
‘‘(6) SELECTION
OF
ACTIVITIES
FUNDED
USING
HOUSING 
TRUST FUND GRANT AMOUNTS.—Grant amounts received by a 
State or State designated entity under this subsection may 
be used, or committed for use, only for activities that— 
‘‘(A) are eligible under paragraph (7) for such use; 
‘‘(B) comply with the applicable allocation plan of the 
State or State designated entity under paragraph (5); and 
Public 
information. 
Notification. 
Public comments. 
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122 STAT. 2716 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) are selected for funding by the State or State 
designated entity in accordance with the process and cri-
teria for such selection established pursuant to subsection 
(g)(2)(D). 
‘‘(7) ELIGIBLE ACTIVITIES.—Grant amounts allocated to a 
State or State designated entity under this subsection shall 
be eligible for use, or for commitment for use, only for assistance 
for— 
‘‘(A) the production, preservation, and rehabilitation 
of rental housing, including housing under the programs 
identified in section 1335(a)(2)(B) and for operating costs, 
except that not less than 75 percent of such grant amounts 
shall be used for the benefit only of extremely low-income 
families or families with incomes at or below the poverty 
line (as such term is defined in section 673 of the Omnibus 
Budget Reconciliation Act of 1981 (42 U.S.C. 9902), 
including any revision required by such section) applicable 
to a family of the size involved, and not more than 25 
percent for the benefit only of very low-income families; 
and 
‘‘(B) the production, preservation, and rehabilitation 
of housing for homeownership, including such forms as 
down payment assistance, closing cost assistance, and 
assistance for interest rate buy-downs, that— 
‘‘(i) is available for purchase only for use as a 
principal residence by families that qualify both as— 
‘‘(I) extremely low- and very low-income fami-
lies at the times described in subparagraphs (A) 
through (C) of section 215(b)(2) of the Cranston- 
Gonzalez National Affordable Housing Act (42 
U.S.C. 12745(b)(2)); and 
‘‘(II) first-time homebuyers, as such term is 
defined in section 104 of the Cranston-Gonzalez 
National Affordable Housing Act (42 U.S.C. 12704), 
except that any reference in such section to assist-
ance under title II of such Act shall for purposes 
of this subsection be considered to refer to assist-
ance from affordable housing fund grant amounts; 
‘‘(ii) has an initial purchase price that meets the 
requirements of section 215(b)(1) of the Cranston- 
Gonzalez National Affordable Housing Act; 
‘‘(iii) is subject to the same resale restrictions 
established under section 215(b)(3) of the Cranston- 
Gonzalez 
National 
Affordable 
Housing 
Act 
and 
applicable to the participating jurisdiction that is the 
State in which such housing is located; and 
‘‘(iv) is made available for purchase only by, or 
in the case of assistance under this subsection, is made 
available only to homebuyers who have, before pur-
chase completed a program of independent financial 
education and counseling from an eligible organization 
that meets the requirements of section 132 of the Fed-
eral Housing Finance Regulatory Reform Act of 2008. 
‘‘(8) TENANT PROTECTIONS AND PUBLIC PARTICIPATION.—All 
amounts from the Trust Fund shall be allocated in accordance 
with, and any eligible activities carried out in whole or in 
part with grant amounts under this subtitle (including housing 
Disadvantaged 
persons. 
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122 STAT. 2717 
PUBLIC LAW 110–289—JULY 30, 2008 
provided with such grant amounts) shall comply with and be 
operated in compliance with— 
‘‘(A) laws relating to tenant protections and tenant 
rights to participate in decision making regarding their 
residences; 
‘‘(B) laws requiring public participation, including laws 
relating to Consolidated Plans, Qualified Allocation Plans, 
and Public Housing Agency Plans; and 
‘‘(C) fair housing laws and laws regarding accessibility 
in federally assisted housing, including section 504 of the 
Rehabilitation Act of 1973. 
‘‘(9) ELIGIBLE RECIPIENTS.—Grant amounts allocated to a 
State or State designated entity under this subsection may 
be provided only to a recipient that is an organization, agency, 
or other entity (including a for-profit entity or a nonprofit 
entity) that— 
‘‘(A) has demonstrated experience and capacity to con-
duct an eligible activity under paragraph (7), as evidenced 
by its ability to— 
‘‘(i) own, construct or rehabilitate, manage, and 
operate an affordable multifamily rental housing 
development; 
‘‘(ii) design, construct or rehabilitate, and market 
affordable housing for homeownership; or 
‘‘(iii) provide forms of assistance, such as down 
payments, closing costs, or interest rate buy-downs 
for purchasers; 
‘‘(B) demonstrates the ability and financial capacity 
to undertake, comply, and manage the eligible activity; 
‘‘(C) demonstrates its familiarity with the requirements 
of any other Federal, State, or local housing program that 
will be used in conjunction with such grant amounts to 
ensure compliance with all applicable requirements and 
regulations of such programs; and 
‘‘(D) makes such assurances to the State or State des-
ignated entity as the Secretary shall, by regulation, require 
to ensure that the recipient will comply with the require-
ments of this subsection during the entire period that 
begins upon selection of the recipient to receive such grant 
amounts and ending upon the conclusion of all activities 
under paragraph (8) that are engaged in by the recipient 
and funded with such grant amounts. 
‘‘(10) LIMITATIONS ON USE.— 
‘‘(A) REQUIRED AMOUNT FOR HOMEOWNERSHIP ACTIVI-
TIES.—Of the aggregate amount allocated to a State or 
State designated entity under this subsection not more 
than 10 percent shall be used for activities under subpara-
graph (B) of paragraph (7). 
‘‘(B) DEADLINE
FOR
COMMITMENT
OR
USE.—Grant 
amounts allocated to a State or State designated entity 
under this subsection shall be used or committed for use 
within 2 years of the date that such grant amounts are 
made available to the State or State designated entity. 
The Secretary shall recapture any such amounts not so 
used or committed for use and reallocate such amounts 
under this subsection in the first year after such recapture. 
Regulations. 
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122 STAT. 2718 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) USE OF RETURNS.—The Secretary shall, by regula-
tion, provide that any return on a loan or other investment 
of any grant amount used by a State or State designated 
entity to provide a loan under this subsection shall be 
treated, for purposes of availability to and use by the 
State or State designated entity, as a grant amount author-
ized under this subsection. 
‘‘(D) PROHIBITED USES.—The Secretary shall, by regula-
tion— 
‘‘(i) set forth prohibited uses of grant amounts 
allocated under this subsection, which shall include 
use for— 
‘‘(I) political activities; 
‘‘(II) advocacy; 
‘‘(III) lobbying, whether directly or through 
other parties; 
‘‘(IV) counseling services; 
‘‘(V) travel expenses; and 
‘‘(VI) preparing or providing advice on tax 
returns; 
and for the purposes of this subparagraph, the prohib-
ited use of funds for political activities includes influ-
encing the selection, nomination, election, or appoint-
ment of one or more candidates to any Federal, State 
or local office as codified in section 501 of the Internal 
Revenue Code of 1986 (26 U.S.C. 501); 
‘‘(ii) provide that, except as provided in clause (iii), 
grant amounts of a State or State designated entity 
may not be used for administrative, outreach, or other 
costs of— 
‘‘(I) the State or State designated entity; or 
‘‘(II) any other recipient of such grant 
amounts; and 
‘‘(iii) limit the amount of any grant amounts for 
a year that may be used by the State or State des-
ignated entity for administrative costs of carrying out 
the program required under this subsection, including 
home ownership counseling, to a percentage of such 
grant amounts of the State or State designated entity 
for such year, which may not exceed 10 percent. 
‘‘(E) PROHIBITION
OF
CONSIDERATION
OF
USE
FOR 
MEETING HOUSING GOALS OR DUTY TO SERVE.—In deter-
mining compliance with the housing goals under this sub-
part and the duty to serve underserved markets under 
section 1335, the Director may not consider any grant 
amounts used under this section for eligible activities under 
paragraph (7). The Director shall give credit toward the 
achievement of such housing goals and such duty to serve 
underserved markets to purchases by the enterprises of 
mortgages for housing that receives funding from such 
grant amounts, but only to the extent that such purchases 
by the enterprises are funded other than with such grant 
amounts. 
‘‘(d) REDUCTION FOR FAILURE TO OBTAIN RETURN OF MISUSED 
FUNDS.—If in any year a State or State designated entity fails 
to obtain reimbursement or return of the full amount required 
Regulations. 
Regulations. 
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122 STAT. 2719 
PUBLIC LAW 110–289—JULY 30, 2008 
under subsection (e)(1)(B) to be reimbursed or returned to the 
State or State designated entity during such year— 
‘‘(1) except as provided in paragraph (2)— 
‘‘(A) the amount of the grant for the State or State 
designated entity for the succeeding year, as determined 
pursuant to this section, shall be reduced by the amount 
by which such amounts required to be reimbursed or 
returned exceed the amount actually reimbursed or 
returned; and 
‘‘(B) the amount of the grant for the succeeding year 
for each other State or State designated entity whose grant 
is not reduced pursuant to subparagraph (A) shall be 
increased by the amount determined by applying the for-
mula established pursuant to this section to the total 
amount of all reductions for all State or State designated 
entities for such year pursuant to subparagraph (A); or 
‘‘(2) in any case in which such failure to obtain reimburse-
ment or return occurs during a year immediately preceding 
a year in which grants under this section will not be made, 
the State or State designated entity shall pay to the Secretary 
for reallocation among the other grantees an amount equal 
to the amount of the reduction for the entity that would other-
wise apply under paragraph (1)(A). 
‘‘(e) ACCOUNTABILITY OF RECIPIENTS AND GRANTEES.— 
‘‘(1) RECIPIENTS.— 
‘‘(A) TRACKING OF FUNDS.—The Secretary shall— 
‘‘(i) require each State or State designated entity 
to develop and maintain a system to ensure that each 
recipient of assistance under this section uses such 
amounts in accordance with this section, the regula-
tions issued under this section, and any requirements 
or conditions under which such amounts were provided; 
and 
‘‘(ii) establish minimum requirements for agree-
ments, between the State or State designated entity 
and recipients, regarding assistance under this section, 
which shall include— 
‘‘(I) appropriate periodic financial and project 
reporting, record retention, and audit require-
ments for the duration of the assistance to the 
recipient to ensure compliance with the limitations 
and requirements of this section and the regula-
tions under this section; and 
‘‘(II) any other requirements that the Secretary 
determines are necessary to ensure appropriate 
administration and compliance. 
‘‘(B) MISUSE OF FUNDS.— 
‘‘(i) 
REIMBURSEMENT
REQUIREMENT.—If 
any 
recipient of assistance under this section is determined, 
in accordance with clause (ii), to have used any such 
amounts in a manner that is materially in violation 
of this section, the regulations issued under this sec-
tion, or any requirements or conditions under which 
such amounts were provided, the State or State des-
ignated entity shall require that, within 12 months 
after the determination of such misuse, the recipient 
shall reimburse the State or State designated entity 
Deadline. 
Reports. 
Recordkeeping. 
Requirements. 
Payments. 
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122 STAT. 2720 
PUBLIC LAW 110–289—JULY 30, 2008 
for such misused amounts and return to the State 
or State designated entity any such amounts that 
remain unused or uncommitted for use. The remedies 
under this clause are in addition to any other remedies 
that may be available under law. 
‘‘(ii) DETERMINATION.—A determination is made in 
accordance with this clause if the determination is 
made by the Secretary or made by the State or State 
designated entity, provided that— 
‘‘(I) the State or State designated entity pro-
vides notification of the determination to the Sec-
retary for review, in the discretion of the Secretary, 
of the determination; and 
‘‘(II) the Secretary does not subsequently 
reverse the determination. 
‘‘(2) GRANTEES.— 
‘‘(A) REPORT.— 
‘‘(i) IN GENERAL.—The Secretary shall require each 
State or State designated entity receiving grant 
amounts in any given year under this section to submit 
a report, for such year, to the Secretary that— 
‘‘(I) describes the activities funded under this 
section during such year with such grant amounts; 
and 
‘‘(II) the manner in which the State or State 
designated entity complied during such year with 
any allocation plan established pursuant to sub-
section (c). 
‘‘(ii) PUBLIC
AVAILABILITY.—The Secretary shall 
make such reports pursuant to this subparagraph pub-
licly available. 
‘‘(B) MISUSE OF FUNDS.—If the Secretary determines, 
after reasonable notice and opportunity for hearing, that 
a State or State designated entity has failed to comply 
substantially with any provision of this section, and until 
the Secretary is satisfied that there is no longer any such 
failure to comply, the Secretary shall— 
‘‘(i) reduce the amount of assistance under this 
section to the State or State designated entity by an 
amount equal to the amount of grant amounts which 
were not used in accordance with this section; 
‘‘(ii) require the State or State designated entity 
to repay the Secretary any amount of the grant which 
was not used in accordance with this section; 
‘‘(iii) limit the availability of assistance under this 
section to the State or State designated entity to activi-
ties or recipients not affected by such failure to comply; 
or 
‘‘(iv) terminate any assistance under this section 
to the State or State designated entity. 
‘‘(f) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply: 
‘‘(1) EXTREMELY
LOW-INCOME
RENTER
HOUSEHOLD.—The 
term ‘extremely low-income renter household’ means a house-
hold whose income is not in excess of 30 percent of the area 
median income, with adjustments for smaller and larger fami-
lies, as determined by the Secretary. 
Notification. 
Notification. 
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122 STAT. 2721 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) RECIPIENT.—The term ‘recipient’ means an individual 
or entity that receives assistance from a State or State des-
ignated entity from amounts made available to the State or 
State designated entity under this section. 
‘‘(3) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORD-
ABLE
AND
AVAILABLE
TO
EXTREMELY
LOW-INCOME
RENTER 
HOUSEHOLDS.— 
‘‘(A) IN
GENERAL.—The term ‘shortage of standard 
rental units both affordable and available to extremely 
low-income renter households’ means for any State or other 
geographical area the gap between— 
‘‘(i) the number of units with complete plumbing 
and kitchen facilities with a rent that is 30 percent 
or less of 30 percent of the adjusted area median 
income as determined by the Secretary that are occu-
pied by extremely low-income renter households or are 
vacant for rent; and 
‘‘(ii) the number of extremely low-income renter 
households. 
‘‘(B) RULE OF CONSTRUCTION.—If the number of units 
described in subparagraph (A)(i) exceeds the number of 
extremely low-income households as described in subpara-
graph (A)(ii), there is no shortage. 
‘‘(4) SHORTAGE OF STANDARD RENTAL UNITS BOTH AFFORD-
ABLE
AND
AVAILABLE
TO
VERY
LOW-INCOME
RENTER
HOUSE-
HOLDS.— 
‘‘(A) IN
GENERAL.—The term ‘shortage of standard 
rental units both affordable and available to very low- 
income renter households’ means for any State or other 
geographical area the gap between— 
‘‘(i) the number of units with complete plumbing 
and kitchen facilities with a rent that is 30 percent 
or less of 50 percent of the adjusted area median 
income as determined by the Secretary that are occu-
pied by very low-income renter households or are 
vacant for rent; and 
‘‘(ii) the number of very low-income renter house-
holds. 
‘‘(B) RULE OF CONSTRUCTION.—If the number of units 
described in subparagraph (A)(i) exceeds the number of 
very low-income households as described in subparagraph 
(A)(ii), there is no shortage. 
‘‘(5) VERY LOW-INCOME FAMILY.—The term ‘very low-income 
family’ has the meaning given such term in section 1303, except 
that such term includes any family that resides in a rural 
area that has an income that does not exceed the poverty 
line (as such term is defined in section 673(2) of the Omnibus 
Budget Reconciliation Act of 1981 (42 U.S.C. 9902(2)), including 
any revision required by such section) applicable to a family 
of the size involved. 
‘‘(6) VERY
LOW-INCOME
RENTER
HOUSEHOLDS.—The term 
‘very low-income renter households’ means a household whose 
income is in excess of 30 percent but not greater than 50 
percent of the area median income, with adjustments for 
smaller and larger families, as determined by the Secretary. 
‘‘(g) REGULATIONS.— 
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122 STAT. 2722 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) IN GENERAL.—The Secretary shall issue regulations 
to carry out this section. 
‘‘(2) REQUIRED CONTENTS.—The regulations issued under 
this subsection shall include— 
‘‘(A) a requirement that the Secretary ensure that the 
use of grant amounts under this section by States or State 
designated entities is audited not less than annually to 
ensure compliance with this section; 
‘‘(B) authority for the Secretary to audit, provide for 
an audit, or otherwise verify a State or State designated 
entity’s activities to ensure compliance with this section; 
‘‘(C) a requirement that, for the purposes of subpara-
graphs (A) and (B), any financial statement submitted by 
a grantee or recipient to the Secretary shall be reviewed 
by an independent certified public accountant in accordance 
with Statements on Standards for Accounting and Review 
Services, issued by the American Institute of Certified 
Public Accountants; 
‘‘(D) requirements for a process for application to, and 
selection by, each State or State designated entity for activi-
ties meeting the State or State designated entity’s priority 
housing needs to be funded with grant amounts under 
this section, which shall provide for priority in funding 
to be based upon— 
‘‘(i) geographic diversity; 
‘‘(ii) ability to obligate amounts and undertake 
activities so funded in a timely manner; 
‘‘(iii) in the case of rental housing projects under 
subsection (c)(7)(A), the extent to which rents for units 
in the project funded are affordable, especially for 
extremely low-income families; 
‘‘(iv) in the case of rental housing projects under 
subsection (c)(7)(A), the extent of the duration for 
which such rents will remain affordable; 
‘‘(v) the extent to which the application makes 
use of other funding sources; and 
‘‘(vi) the merits of an applicant’s proposed eligible 
activity; 
‘‘(E) requirements to ensure that grant amounts pro-
vided to a State or State designated entity under this 
section that are used for rental housing under subsection 
(c)(7)(A) are used only for the benefit of extremely low- 
and very low-income families; and 
‘‘(F) requirements and standards for establishment, by 
a State or State designated entity, for use of grant amounts 
in 2009 and subsequent years of performance goals, bench-
marks, and timetables for the production, preservation, 
and rehabilitation of affordable rental and homeownership 
housing with such grant amounts. 
‘‘(h) AFFORDABLE HOUSING TRUST FUND.—If, after the date 
of enactment of the Federal Housing Finance Regulatory Reform 
Act of 2008, in any year, there is enacted any provision of Federal 
law establishing an affordable housing trust fund other than under 
this title for use only for grants to provide affordable rental housing 
and affordable homeownership opportunities, and the subsequent 
year is a year referred to in subsection (c), the Secretary shall 
in such subsequent year and any remaining years referred to in 
Deadline. 
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122 STAT. 2723 
PUBLIC LAW 110–289—JULY 30, 2008 
subsection (c) transfer to such affordable housing trust fund the 
aggregate amount allocated pursuant to subsection (c) in such year. 
Notwithstanding any other provision of law, assistance provided 
using amounts transferred to such affordable housing trust fund 
pursuant to this subsection may not be used for any of the activities 
specified in clauses (i) through (vi) of subsection (c)(9)(D). 
‘‘(i) FUNDING ACCOUNTABILITY AND TRANSPARENCY.—Any grant 
under this section to a grantee by a State or State designated 
entity, any assistance provided to a recipient by a State or State 
designated entity, and any grant, award, or other assistance from 
an affordable housing trust fund referred to in subsection (h) shall 
be considered a Federal award for purposes of the Federal Funding 
Accountability and Transparency Act of 2006 (31 U.S.C. 6101 note). 
Upon the request of the Director of the Office of Management 
and Budget, the Secretary shall obtain and provide such information 
regarding any such grants, assistance, and awards as the Director 
of the Office of Management and Budget considers necessary to 
comply with the requirements of such Act, as applicable, pursuant 
to the preceding sentence. 
‘‘SEC. 1339. CAPITAL MAGNET FUND. 
‘‘(a) ESTABLISHMENT.—There is established in the Treasury of 
the United States a trust fund to be known as the Capital Magnet 
Fund, which shall be a special account within the Community 
Development Financial Institutions Fund. 
‘‘(b) DEPOSITS TO TRUST FUND.—The Capital Magnet Fund shall 
consist of— 
‘‘(1) any amounts transferred to the Fund pursuant to 
section 1337; and 
‘‘(2) any amounts as are or may be appropriated, trans-
ferred, or credited to such Fund under any other provisions 
of law. 
‘‘(c) EXPENDITURES FROM TRUST FUND.—Amounts in the Capital 
Magnet Fund shall be available to the Secretary of the Treasury 
to carry out a competitive grant program to attract private capital 
for and increase investment in— 
‘‘(1) the development, preservation, rehabilitation, or pur-
chase of affordable housing for primarily extremely low-, very 
low-, and low-income families; and 
‘‘(2) economic development activities or community service 
facilities, such as day care centers, workforce development cen-
ters, and health care clinics, which in conjunction with afford-
able housing activities implement a concerted strategy to sta-
bilize or revitalize a low-income area or underserved rural 
area. 
‘‘(d) FEDERAL ASSISTANCE.—For purposes of the application of 
Federal civil rights laws, all assistance provided using amounts 
in the Capital Magnet Fund shall be considered Federal financial 
assistance. 
‘‘(e) ELIGIBLE GRANTEES.—A grant under this section may be 
made, pursuant to such requirements as the Secretary of the 
Treasury shall establish for experience and success in attracting 
private financing and carrying out the types of activities proposed 
under the application of the grantee, only to— 
‘‘(1) a Treasury certified community development financial 
institution; or 
Requirements. 
Grants. 
12 USC 4569. 
Records. 
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122 STAT. 2724 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) a nonprofit organization having as 1 of its principal 
purposes the development or management of affordable 
housing. 
‘‘(f) ELIGIBLE USES.—Grant amounts awarded from the Capital 
Magnet Fund pursuant to this section may be used for the purposes 
described in paragraphs (1) and (2) of subsection (c), including 
for the following uses: 
‘‘(1) To provide loan loss reserves. 
‘‘(2) To capitalize a revolving loan fund. 
‘‘(3) To capitalize an affordable housing fund. 
‘‘(4) To capitalize a fund to support activities described 
in subsection (c)(2). 
‘‘(5) For risk-sharing loans. 
‘‘(g) APPLICATIONS.— 
‘‘(1) IN GENERAL.—The Secretary of the Treasury shall pro-
vide, in a competitive application process established by regula-
tion, for eligible grantees under subsection (e) to submit applica-
tions for Capital Magnet Fund grants to the Secretary at such 
time and in such manner as the Secretary shall determine. 
‘‘(2) CONTENT OF APPLICATION.—The application required 
under paragraph (1) shall include a detailed description of— 
‘‘(A) the types of affordable housing, economic, and 
community revitalization projects that support or sustain 
residents of an affordable housing project funded by a 
grant under this section for which such grant amounts 
would be used, including the proposed use of eligible grants 
as authorized under this section; 
‘‘(B) the types, sources, and amounts of other funding 
for such projects; and 
‘‘(C) the expected time frame of any grant used for 
such project. 
‘‘(h) GRANT LIMITATION.— 
‘‘(1) IN GENERAL.—Any 1 eligible grantee and its subsidi-
aries and affiliates may not be awarded more than 15 percent 
of the aggregate funds available for grants during any year 
from the Capital Magnet Fund. 
‘‘(2) GEOGRAPHIC DIVERSITY.— 
‘‘(A) GOAL.—The Secretary of the Treasury shall seek 
to fund activities in geographically diverse areas of eco-
nomic distress, including metropolitan and underserved 
rural areas in every State. 
‘‘(B) DIVERSITY DEFINED.—For purposes of this para-
graph, geographic diversity includes those areas that meet 
objective criteria of economic distress developed by the 
Secretary of the Treasury, which may include— 
‘‘(i) the percentage of low-income families or the 
extent of poverty; 
‘‘(ii) the rate of unemployment or underemploy-
ment; 
‘‘(iii) extent of blight and disinvestment; 
‘‘(iv) projects that target extremely low-, very low- 
, and low-income families in or outside a designated 
economic distress area; or 
‘‘(v) any other criteria designated by the Secretary 
of the Treasury. 
‘‘(3) LEVERAGE OF FUNDS.—Each grant from the Capital 
Magnet Fund awarded under this section shall be reasonably 
Regulations. 
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122 STAT. 2725 
PUBLIC LAW 110–289—JULY 30, 2008 
expected to result in eligible housing, or economic and commu-
nity development projects that support or sustain an affordable 
housing project funded by a grant under this section whose 
aggregate costs total at least 10 times the grant amount. 
‘‘(4) COMMITMENT
FOR
USE
DEADLINE.—Amounts made 
available for grants under this section shall be committed for 
use within 2 years of the date of such allocation. The Secretary 
of the Treasury shall recapture into the Capital Magnet Fund 
any amounts not so used or committed for use and allocate 
such amounts in the first year after such recapture. 
‘‘(5) PROHIBITED USES.—The Secretary shall, by regulation, 
set forth prohibited uses of grant amounts awarded under 
this section, which shall include use for— 
‘‘(A) political activities; 
‘‘(B) advocacy; 
‘‘(C) lobbying, whether directly or through other par-
ties; 
‘‘(D) counseling services; 
‘‘(E) travel expenses; and 
‘‘(F) preparing or providing advice on tax returns; 
and for the purposes of this paragraph, the prohibited use 
of funds for political activities includes influencing the selection, 
nomination, election, or appointment of one or more candidates 
to any Federal, State or local office as codified in section §501 
of the Internal Revenue Code of 1986 (26 U.S.C. 501). 
‘‘(6) ADDITIONAL LOBBYING RESTRICTIONS.—No assistance 
or amounts made available under this section may be expended 
by an eligible grantee to pay any person to influence or attempt 
to influence any agency, elected official, officer or employee 
of a State or local government in connection with the making, 
award, extension, continuation, renewal, amendment, or modi-
fication of any State or local government contract, grant, loan, 
or cooperative agreement as such terms are defined in section 
1352 of title 31, United States Code. 
‘‘(7) PROHIBITION OF CONSIDERATION OF USE FOR MEETING 
HOUSING GOALS OR DUTY TO SERVE.—In determining the compli-
ance of the enterprises with the housing goals under this section 
and the duty to serve underserved markets under section 1335, 
the Director of the Federal Housing Finance Agency may not 
consider any Capital Magnet Fund amounts used under this 
section for eligible activities under subsection (f). The Director 
of the Federal Housing Finance Agency shall give credit toward 
the achievement of such housing goals and such duty to serve 
underserved markets to purchases by the enterprises of mort-
gages for housing that receives funding from Capital Magnet 
Fund grant amounts, but only to the extent that such purchases 
by the enterprises are funded other than with such grant 
amounts. 
‘‘(8) ACCOUNTABILITY OF RECIPIENTS AND GRANTEES.— 
‘‘(A) TRACKING
OF
FUNDS.—The Secretary of the 
Treasury shall— 
‘‘(i) require each grantee to develop and maintain 
a system to ensure that each recipient of assistance 
from the Capital Magnet Fund uses such amounts 
in accordance with this section, the regulations issued 
under this section, and any requirements or conditions 
under which such amounts were provided; and 
Records. 
Regulations. 
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122 STAT. 2726 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) establish minimum requirements for agree-
ments, between the grantee and the Capital Magnet 
Fund, regarding assistance from the Capital Magnet 
Fund, which shall include— 
‘‘(I) appropriate periodic financial and project 
reporting, record retention, and audit require-
ments for the duration of the grant to the recipient 
to ensure compliance with the limitations and 
requirements of this section and the regulations 
under this section; and 
‘‘(II) any other requirements that the Secretary 
determines are necessary to ensure appropriate 
grant administration and compliance. 
‘‘(B) MISUSE
OF
FUNDS.—If the Secretary of the 
Treasury determines, after reasonable notice and oppor-
tunity for hearing, that a grantee has failed to comply 
substantially with any provision of this section and until 
the Secretary is satisfied that there is no longer any such 
failure to comply, the Secretary shall— 
‘‘(i) reduce the amount of assistance under this 
section to the grantee by an amount equal to the 
amount of Capital Magnet Fund grant amounts which 
were not used in accordance with this section; 
‘‘(ii) require the grantee to repay the Secretary 
any amount of the Capital Magnet Fund grant amounts 
which were not used in accordance with this section; 
‘‘(iii) limit the availability of assistance under this 
section to the grantee to activities or recipients not 
affected by such failure to comply; or 
‘‘(iv) terminate any assistance under this section 
to the grantee. 
‘‘(i) PERIODIC REPORTS.— 
‘‘(1) IN
GENERAL.—The Secretary of the Treasury shall 
submit a report, on a periodic basis, to the Committee on 
Banking, Housing, and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of Representa-
tives describing the activities to be funded under this section. 
‘‘(2) REPORTS AVAILABLE TO PUBLIC.—The Secretary of the 
Treasury shall make the reports required under paragraph 
(1) publicly available. 
‘‘(j) REGULATIONS.— 
‘‘(1) IN GENERAL.—The Secretary of the Treasury shall issue 
regulations to carry out this section. 
‘‘(2) REQUIRED CONTENTS.—The regulations issued under 
this subsection shall include— 
‘‘(A) authority for the Secretary to audit, provide for 
an audit, or otherwise verify an enterprise’s activities, to 
ensure compliance with this section; 
‘‘(B) a requirement that the Secretary ensure that the 
allocation of each enterprise is audited not less than 
annually to ensure compliance with this section; 
‘‘(C) a requirement that, for the purposes of subpara-
graphs (A) and (B), any financial statement submitted by 
a grantee to the Secretary shall be reviewed by an inde-
pendent certified public accountant in accordance with 
Deadline. 
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122 STAT. 2727 
PUBLIC LAW 110–289—JULY 30, 2008 
Statements on Standards for Accounting and Review Serv-
ices, issued by the American Institute of Certified Public 
Accountants; and 
‘‘(D) requirements for a process for application to, and 
selection by, the Secretary for activities to be funded with 
amounts from the Capital Magnet Fund, which shall pro-
vide that— 
‘‘(i) funds be fairly distributed to urban, suburban, 
and rural areas; and 
‘‘(ii) selection shall be based upon specific criteria, 
including a prioritization of funding based upon— 
‘‘(I) the ability to use such funds to generate 
additional investments; 
‘‘(II) affordable housing need (taking into 
account the distinct needs of different regions of 
the country); and 
‘‘(III) ability to obligate amounts and under-
take activities so funded in a timely manner.’’. 
SEC. 1132. FINANCIAL EDUCATION AND COUNSELING. 
(a) GOALS.—Financial education and counseling under this sec-
tion shall have the goal of— 
(1) increasing the financial knowledge and decision making 
capabilities of prospective homebuyers; 
(2) assisting prospective homebuyers to develop monthly 
budgets, build personal savings, finance or plan for major pur-
chases, reduce their debt, improve their financial stability, and 
set and reach their financial goals; 
(3) helping prospective homebuyers to improve their credit 
scores by understanding the relationship between their credit 
histories and their credit scores; and 
(4) educating prospective homebuyers about the options 
available to build savings for short- and long-term goals. 
(b) GRANTS.— 
(1) IN GENERAL.—The Secretary of the Treasury (in this 
section referred to as the ‘‘Secretary’’) shall make grants to 
eligible organizations to enable such organizations to provide 
a range of financial education and counseling services to 
prospective homebuyers. 
(2) 
SELECTION.—The 
Secretary 
shall 
select 
eligible 
organizations to receive assistance under this section based 
on their experience and ability to provide financial education 
and counseling services that result in documented positive 
behavioral changes. 
(c) ELIGIBLE ORGANIZATIONS.— 
(1) IN GENERAL.—For purposes of this section, the term 
‘‘eligible organization’’ means an organization that is— 
(A) certified in accordance with section 106(e)(1) of 
the Housing and Urban Development Act of 1968 (12 U.S.C. 
1701x(e)); or 
(B) certified by the Office of Financial Education of 
the Department of the Treasury for purposes of this section, 
in accordance with paragraph (2). 
(2) OFE CERTIFICATION.—To be certified by the Office of 
Financial Education for purposes of this section, an eligible 
organization shall be— 
12 USC 1701x 
note. 
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122 STAT. 2728 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) a housing counseling agency certified by the Sec-
retary of Housing and Urban Development under section 
106(e) of the Housing and Urban Development Act of 1968; 
(B) a State, local, or tribal government agency; 
(C) a community development financial institution (as 
defined in section 103(5) of the Community Development 
Banking and Financial Institutions Act of 1994 (12 U.S.C. 
4702(5)) or a credit union; or 
(D) any collaborative effort of entities described in 
any of subparagraphs (A) through (C). 
(d) AUTHORITY FOR PILOT PROJECTS.— 
(1) IN
GENERAL.—The Secretary of the Treasury shall 
authorize not more than 5 pilot project grants to eligible 
organizations under subsection (c) in order to— 
(A) carry out the services under this section; and 
(B) provide such other services that will improve the 
financial stability and economic condition of low- and mod-
erate-income and low-wealth individuals. 
(2) GOAL.—The goal of the pilot project grants under this 
subsection is to— 
(A) identify successful methods resulting in positive 
behavioral change for financial empowerment; and 
(B) establish program models for organizations to carry 
out effective counseling services. 
(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized 
to be appropriated to the Secretary such sums as are necessary 
to carry out this section and for the provision of additional financial 
educational services. 
(f) STUDY AND REPORT ON EFFECTIVENESS AND IMPACT.— 
(1) IN GENERAL.—The Comptroller General of the United 
States shall conduct a study on the effectiveness and impact 
of the grant program established under this section. Not later 
than 3 years after the date of enactment of this Act, the 
Comptroller General shall submit a report on the results of 
such study to the Committee on Banking, Housing, and Urban 
Affairs of the Senate and the Committee on Financial Services 
of the House of Representatives. 
(2) CONTENT OF STUDY.—The study required under para-
graph (1) shall include an evaluation of the following: 
(A) The effectiveness of the grant program established 
under this section in improving the financial situation of 
homeowners and prospective homebuyers served by the 
grant program. 
(B) The extent to which financial education and coun-
seling services have resulted in positive behavioral changes. 
(C) The effectiveness and quality of the eligible 
organizations providing financial education and counseling 
services under the grant program. 
(g) REGULATIONS.—The Secretary is authorized to promulgate 
such regulations as may be necessary to implement and administer 
the grant program authorized by this section. 
SEC. 1133. TRANSFER AND RIGHTS OF CERTAIN HUD EMPLOYEES. 
(a) TRANSFER.—Each employee of the Department of Housing 
and Urban Development whose position responsibilities primarily 
involve the establishment and enforcement of the housing goals 
under subpart B of part 2 of subtitle A of the Federal Housing 
Deadline. 
12 USC 4511 
note. 
Grants. 
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122 STAT. 2729 
PUBLIC LAW 110–289—JULY 30, 2008 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4561 et seq.) shall be transferred to the Federal Housing Finance 
Agency for employment, not later than the effective date of the 
Federal Housing Finance Regulatory Reform Act of 2008, and such 
transfer shall be deemed a transfer of function for purposes of 
section 3503 of title 5, United States Code. 
(b) GUARANTEED POSITIONS.— 
(1) IN GENERAL.—Each employee transferred under sub-
section (a) shall be guaranteed a position with the same status, 
tenure, grade, and pay as that held on the day immediately 
preceding the transfer. 
(2) NO
INVOLUNTARY
SEPARATION
OR
REDUCTION.—An 
employee transferred under subsection (a) holding a permanent 
position on the day immediately preceding the transfer may 
not be involuntarily separated or reduced in grade or compensa-
tion during the 12-month period beginning on the date of 
transfer, except for cause, or, in the case of a temporary 
employee, separated in accordance with the terms of the 
appointment of the employee. 
(c) APPOINTMENT AUTHORITY FOR EXCEPTED AND SENIOR EXECU-
TIVE SERVICE EMPLOYEES.— 
(1) IN GENERAL.—In the case of an employee occupying 
a position in the excepted service or the Senior Executive 
Service, any appointment authority established under law or 
by regulations of the Office of Personnel Management for filling 
such position shall be transferred, subject to paragraph (2). 
(2) DECLINE OF TRANSFER.—The Director may decline a 
transfer of authority under paragraph (1) to the extent that 
such authority relates to— 
(A) a position excepted from the competitive service 
because of its confidential, policymaking, policy-deter-
mining, or policy-advocating character; or 
(B) a noncareer position in the Senior Executive Service 
(within the meaning of section 3132(a)(7) of title 5, United 
States Code). 
(d) REORGANIZATION.—If the Director determines, after the end 
of the 1-year period beginning on the effective date of the Federal 
Housing Finance Regulatory Reform Act of 2008, that a reorganiza-
tion of the combined workforce is required, that reorganization 
shall be deemed a major reorganization for purposes of affording 
affected 
employee 
retirement 
under 
section 
8336(d)(2) 
or 
8414(b)(1)(B) of title 5, United States Code. 
(e) EMPLOYEE BENEFIT PROGRAMS.— 
(1) IN GENERAL.—Any employee described under subsection 
(a) accepting employment with the Agency as a result of a 
transfer under subsection (a) may retain, for 12 months after 
the date on which such transfer occurs, membership in any 
employee benefit program of the Agency or the Department 
of Housing and Urban Development, as applicable, including 
insurance, to which such employee belongs on such effective 
date, if— 
(A) the employee does not elect to give up the benefit 
or membership in the program; and 
(B) the benefit or program is continued by the Director 
of the Federal Housing Finance Agency. 
(2) COST DIFFERENTIAL.— 
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122 STAT. 2730 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) IN GENERAL.—The difference in the costs between 
the benefits which would have been provided by the Depart-
ment of Housing and Urban Development and those pro-
vided by this section shall be paid by the Director. 
(B) HEALTH INSURANCE.—If any employee elects to give 
up membership in a health insurance program or the health 
insurance program is not continued by the Director, the 
employee shall be permitted to select an alternate Federal 
health insurance program not later than 30 days after 
the date of such election or notice, without regard to any 
other regularly scheduled open season. 
Subtitle C—Prompt Corrective Action 
SEC. 1141. CRITICAL CAPITAL LEVELS. 
(a) IN GENERAL.—Section 1363 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4613) 
is amended— 
(1) by striking ‘‘For’’ and inserting ‘‘(a) ENTERPRISES.— 
FOR’’; and 
(2) by adding at the end the following new subsection: 
‘‘(b) FEDERAL HOME LOAN BANKS.— 
‘‘(1) IN GENERAL.—For purposes of this subtitle, the critical 
capital level for each Federal Home Loan Bank shall be such 
amount of capital as the Director shall, by regulation, require. 
‘‘(2) CONSIDERATION OF OTHER CRITICAL CAPITAL LEVELS.— 
In establishing the critical capital level under paragraph (1) 
for the Federal Home Loan Banks, the Director shall take 
due consideration of the critical capital level established under 
subsection (a) for the enterprises, with such modifications as 
the Director determines to be appropriate to reflect the dif-
ference in operations between the banks and the enterprises.’’. 
(b) REGULATIONS.—Not later than the expiration of the 180- 
day period beginning on the date of enactment of this Act, the 
Director of the Federal Housing Finance Agency shall issue regula-
tions pursuant to section 1363(b) of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (as added by this 
section) establishing the critical capital level under such section. 
SEC. 1142. CAPITAL CLASSIFICATIONS. 
(a) IN GENERAL.—Section 1364 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4614) 
is amended— 
(1) in the heading for subsection (a) by striking ‘‘In General’’ 
and inserting ‘‘Enterprises’’; 
(2) in subsection (c)— 
(A) by striking ‘‘subsection (b)’’ and inserting ‘‘sub-
section (c)’’; 
(B) by striking ‘‘enterprises’’ and inserting ‘‘regulated 
entities’’; and 
(C) by striking the last sentence; 
(3) by redesignating subsections (c) (as so amended by 
paragraph (2) of this subsection) and (d) as subsections (d) 
and (f), respectively; 
(4) by striking subsection (b) and inserting the following: 
‘‘(b) FEDERAL HOME LOAN BANKS.— 
Deadline. 
12 USC 4613 
note. 
Regulations. 
Deadline. 
Payments. 
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122 STAT. 2731 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) ESTABLISHMENT AND CRITERIA.—For purposes of this 
subtitle, the Director shall, by regulation— 
‘‘(A) establish the capital classifications specified under 
paragraph (2) for the Federal Home Loan Banks; 
‘‘(B) establish criteria for each such capital classifica-
tion based on the amount and types of capital held by 
a bank and the risk-based, minimum, and critical capital 
levels for the banks and taking due consideration of the 
capital classifications established under subsection (a) for 
the enterprises, with such modifications as the Director 
determines to be appropriate to reflect the difference in 
operations between the banks and the enterprises; and 
‘‘(C) shall classify the Federal Home Loan Banks 
according to such capital classifications. 
‘‘(2) CLASSIFICATIONS.—The capital classifications specified 
under this paragraph are— 
‘‘(A) adequately capitalized; 
‘‘(B) undercapitalized; 
‘‘(C) significantly undercapitalized; and 
‘‘(D) critically undercapitalized. 
‘‘(c) DISCRETIONARY CLASSIFICATION.— 
‘‘(1) GROUNDS FOR RECLASSIFICATION.—The Director may 
reclassify a regulated entity under paragraph (2) if— 
‘‘(A) at any time, the Director determines in writing 
that the regulated entity is engaging in conduct that could 
result in a rapid depletion of core or total capital or the 
value of collateral pledged as security has decreased signifi-
cantly or that the value of the property subject to mortgages 
held by the regulated entity (or securitized in the case 
of an enterprise) has decreased significantly; 
‘‘(B) after notice and an opportunity for hearing, the 
Director determines that the regulated entity is in an 
unsafe or unsound condition; or 
‘‘(C) pursuant to section 1371(b), the Director deems 
the regulated entity to be engaging in an unsafe or unsound 
practice. 
‘‘(2) RECLASSIFICATION.—In addition to any other action 
authorized under this title, including the reclassification of 
a regulated entity for any reason not specified in this sub-
section, if the Director takes any action described in paragraph 
(1), the Director may classify a regulated entity— 
‘‘(A) as undercapitalized, if the regulated entity is 
otherwise classified as adequately capitalized; 
‘‘(B) as significantly undercapitalized, if the regulated 
entity is otherwise classified as undercapitalized; and 
‘‘(C) as critically undercapitalized, if the regulated 
entity is otherwise classified as significantly undercapital-
ized.’’; and 
(5) by inserting after subsection (d) (as so redesignated 
by paragraph (3) of this subsection), the following new sub-
section: 
‘‘(e) RESTRICTION ON CAPITAL DISTRIBUTIONS.— 
‘‘(1) IN GENERAL.—A regulated entity shall make no capital 
distribution if, after making the distribution, the regulated 
entity would be undercapitalized. 
Regulations. 
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122 STAT. 2732 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) EXCEPTION.—Notwithstanding paragraph (1), the 
Director may permit a regulated entity, to the extent appro-
priate or applicable, to repurchase, redeem, retire, or otherwise 
acquire shares or ownership interests if the repurchase, 
redemption, retirement, or other acquisition— 
‘‘(A) is made in connection with the issuance of addi-
tional shares or obligations of the regulated entity in at 
least an equivalent amount; and 
‘‘(B) will reduce the financial obligations of the regu-
lated entity or otherwise improve the financial condition 
of the entity.’’. 
(b) REGULATIONS.—Not later than the expiration of the 180- 
day period beginning on the date of enactment of this Act, the 
Director of the Federal Housing Finance Agency shall issue regula-
tions to carry out section 1364(b) of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (as added by this 
section), relating to capital classifications for the Federal Home 
Loan Banks. 
SEC. 1143. SUPERVISORY ACTIONS APPLICABLE TO UNDERCAPITAL-
IZED REGULATED ENTITIES. 
Section 1365 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4615) is amended— 
(1) by striking ‘‘the enterprise’’ each place that term 
appears and inserting ‘‘the regulated entity’’; 
(2) by striking ‘‘An enterprise’’ each place that term appears 
and inserting ‘‘A regulated entity’’; 
(3) by striking ‘‘an enterprise’’ each place that term appears 
and inserting ‘‘a regulated entity’’; 
(4) in subsection (a)— 
(A) by redesignating paragraphs (1) and (2) as para-
graphs (2) and (3), respectively; 
(B) by inserting before paragraph (2), as redesignated, 
the following: 
‘‘(1) REQUIRED MONITORING.—The Director shall— 
‘‘(A) closely monitor the condition of any undercapital-
ized regulated entity; 
‘‘(B) closely monitor compliance with the capital res-
toration plan, restrictions, and requirements imposed on 
an undercapitalized regulated entity under this section; 
and 
‘‘(C) periodically review the plan, restrictions, and 
requirements applicable to an undercapitalized regulated 
entity to determine whether the plan, restrictions, and 
requirements are achieving the purpose of this section.’’; 
and 
(C) by adding at the end the following: 
‘‘(4) RESTRICTION OF ASSET GROWTH.—An undercapitalized 
regulated entity shall not permit its average total assets during 
any calendar quarter to exceed its average total assets during 
the preceding calendar quarter, unless— 
‘‘(A) the Director has accepted the capital restoration 
plan of the regulated entity; 
‘‘(B) any increase in total assets is consistent with 
the capital restoration plan; and 
‘‘(C) the ratio of tangible equity to assets of the regu-
lated entity increases during the calendar quarter at a 
Review. 
Deadline. 
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122 STAT. 2733 
PUBLIC LAW 110–289—JULY 30, 2008 
rate sufficient to enable the regulated entity to become 
adequately capitalized within a reasonable time. 
‘‘(5) PRIOR APPROVAL OF ACQUISITIONS AND NEW ACTIVI-
TIES.—An undercapitalized regulated entity shall not, directly 
or indirectly, acquire any interest in any entity or engage 
in any new activity, unless— 
‘‘(A) the Director has accepted the capital restoration 
plan of the regulated entity, the regulated entity is imple-
menting the plan, and the Director determines that the 
proposed action is consistent with and will further the 
achievement of the plan; or 
‘‘(B) the Director determines that the proposed action 
will further the purpose of this subtitle.’’; 
(5) in subsection (b)— 
(A) in the subsection heading, by striking ‘‘DISCRE-
TIONARY’’; 
(B) in the matter preceding paragraph (1), by striking 
‘‘may’’ and inserting ‘‘shall’’; and 
(C) in paragraph (2)— 
(i) by striking ‘‘make, in good faith, reasonable 
efforts necessary to’’; and 
(ii) by striking the period at the end and inserting 
‘‘in any material respect.’’; and 
(6) by striking subsection (c) and inserting the following: 
‘‘(c) OTHER DISCRETIONARY SAFEGUARDS.—The Director may 
take, with respect to an undercapitalized regulated entity, any 
of the actions authorized to be taken under section 1366 with 
respect to a significantly undercapitalized regulated entity, if the 
Director determines that such actions are necessary to carry out 
the purpose of this subtitle.’’. 
SEC. 1144. SUPERVISORY ACTIONS APPLICABLE TO SIGNIFICANTLY 
UNDERCAPITALIZED REGULATED ENTITIES. 
Section 1366 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4616) is amended— 
(1) in subsection (a)(2), by striking ‘‘undercapitalized enter-
prise’’ and inserting ‘‘undercapitalized’’; 
(2) by striking ‘‘the enterprise’’ each place that term 
appears and inserting ‘‘the regulated entity’’; 
(3) by striking ‘‘An enterprise’’ each place that term appears 
and inserting ‘‘A regulated entity’’; 
(4) by striking ‘‘an enterprise’’ each place that term appears 
and inserting ‘‘a regulated entity’’; 
(5) in subsection (b)— 
(A) in the subsection heading, by striking ‘‘DISCRE-
TIONARY SUPERVISORY’’ and inserting ‘‘SPECIFIC’’; 
(B) in the matter preceding paragraph (1), by striking 
‘‘may, at any time, take any’’ and inserting ‘‘shall carry 
out this section by taking, at any time, 1 or more’’; 
(C) by striking paragraph (6); 
(D) by redesignating paragraph (5) as paragraph (6); 
(E) by inserting after paragraph (4) the following: 
‘‘(5) IMPROVEMENT OF MANAGEMENT.—Take 1 or more of 
the following actions: 
‘‘(A) NEW ELECTION OF BOARD.—Order a new election 
for the board of directors of the regulated entity. 
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122 STAT. 2734 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) DISMISSAL
OF
DIRECTORS
OR
EXECUTIVE
OFFI-
CERS.—Require the regulated entity to dismiss from office 
any director or executive officer who had held office for 
more than 180 days immediately before the date on which 
the regulated entity became undercapitalized. Dismissal 
under this subparagraph shall not be construed to be a 
removal pursuant to the enforcement powers of the Director 
under section 1377. 
‘‘(C) EMPLOY QUALIFIED EXECUTIVE OFFICERS.—Require 
the regulated entity to employ qualified executive officers 
(who, if the Director so specifies, shall be subject to 
approval by the Director).’’; and 
(F) by adding at the end the following: 
‘‘(7) OTHER ACTION.—Require the regulated entity to take 
any other action that the Director determines will better carry 
out the purpose of this section than any of the other actions 
specified in this subsection.’’; and 
(6) by striking subsection (c) and inserting the following: 
‘‘(c) RESTRICTION ON COMPENSATION OF EXECUTIVE OFFICERS.— 
A regulated entity that is classified as significantly undercapitalized 
in accordance with section 1364 may not, without prior written 
approval by the Director— 
‘‘(1) pay any bonus to any executive officer; or 
‘‘(2) provide compensation to any executive officer at a 
rate exceeding the average rate of compensation of that officer 
(excluding bonuses, stock options, and profit sharing) during 
the 12 calendar months preceding the calendar month in which 
the regulated entity became significantly undercapitalized.’’. 
SEC. 1145. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGU-
LATED ENTITIES. 
(a) IN GENERAL.—Section 1367 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4617) 
is amended to read as follows: 
‘‘SEC. 1367. AUTHORITY OVER CRITICALLY UNDERCAPITALIZED REGU-
LATED ENTITIES. 
‘‘(a) APPOINTMENT
OF
THE
AGENCY
AS
CONSERVATOR
OR 
RECEIVER.— 
‘‘(1) IN GENERAL.—Notwithstanding any other provision of 
Federal or State law, the Director may appoint the Agency 
as conservator or receiver for a regulated entity in the manner 
provided under paragraph (2) or (4). All references to the conser-
vator or receiver under this section are references to the Agency 
acting as conservator or receiver. 
‘‘(2) DISCRETIONARY APPOINTMENT.—The Agency may, at 
the discretion of the Director, be appointed conservator or 
receiver for the purpose of reorganizing, rehabilitating, or 
winding up the affairs of a regulated entity. 
‘‘(3) GROUNDS FOR DISCRETIONARY APPOINTMENT OF CONSER-
VATOR OR RECEIVER.—The grounds for appointing conservator 
or receiver for any regulated entity under paragraph (2) are 
as follows: 
‘‘(A) ASSETS
INSUFFICIENT
FOR
OBLIGATIONS.—The 
assets of the regulated entity are less than the obligations 
of the regulated entity to its creditors and others. 
‘‘(B) SUBSTANTIAL
DISSIPATION.—Substantial dissipa-
tion of assets or earnings due to— 
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122 STAT. 2735 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) any violation of any provision of Federal or 
State law; or 
‘‘(ii) any unsafe or unsound practice. 
‘‘(C) UNSAFE OR UNSOUND CONDITION.—An unsafe or 
unsound condition to transact business. 
‘‘(D) CEASE AND DESIST ORDERS.—Any willful violation 
of a cease and desist order that has become final. 
‘‘(E) CONCEALMENT.—Any concealment of the books, 
papers, records, or assets of the regulated entity, or any 
refusal to submit the books, papers, records, or affairs 
of the regulated entity, for inspection to any examiner 
or to any lawful agent of the Director. 
‘‘(F) INABILITY TO MEET OBLIGATIONS.—The regulated 
entity is likely to be unable to pay its obligations or meet 
the demands of its creditors in the normal course of busi-
ness. 
‘‘(G) LOSSES.—The regulated entity has incurred or 
is likely to incur losses that will deplete all or substantially 
all of its capital, and there is no reasonable prospect for 
the regulated entity to become adequately capitalized (as 
defined in section 1364(a)(1)). 
‘‘(H) VIOLATIONS OF LAW.—Any violation of any law 
or regulation, or any unsafe or unsound practice or condi-
tion that is likely to— 
‘‘(i) cause insolvency or substantial dissipation of 
assets or earnings; or 
‘‘(ii) weaken the condition of the regulated entity. 
‘‘(I) CONSENT.—The regulated entity, by resolution of 
its board of directors or its shareholders or members, con-
sents to the appointment. 
‘‘(J) UNDERCAPITALIZATION.—The regulated entity is 
undercapitalized or significantly undercapitalized (as 
defined in section 1364(a)(3)), and— 
‘‘(i) has no reasonable prospect of becoming ade-
quately capitalized; 
‘‘(ii) fails to become adequately capitalized, as 
required by— 
‘‘(I) section 1365(a)(1) with respect to a regu-
lated entity; or 
‘‘(II) section 1366(a)(1) with respect to a signifi-
cantly undercapitalized regulated entity; 
‘‘(iii) fails to submit a capital restoration plan 
acceptable to the Agency within the time prescribed 
under section 1369C; or 
‘‘(iv) materially fails to implement a capital res-
toration plan submitted and accepted under section 
1369C. 
‘‘(K) CRITICAL
UNDERCAPITALIZATION.—The regulated 
entity is critically undercapitalized, as defined in section 
1364(a)(4). 
‘‘(L) MONEY LAUNDERING.—The Attorney General noti-
fies the Director in writing that the regulated entity has 
been found guilty of a criminal offense under section 1956 
or 1957 of title 18, United States Code, or section 5322 
or 5324 of title 31, United States Code. 
‘‘(4) MANDATORY RECEIVERSHIP.— 
Notification. 
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122 STAT. 2736 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) IN
GENERAL.—The Director shall appoint the 
Agency as receiver for a regulated entity if the Director 
determines, in writing, that— 
‘‘(i) the assets of the regulated entity are, and 
during the preceding 60 calendar days have been, less 
than the obligations of the regulated entity to its credi-
tors and others; or 
‘‘(ii) the regulated entity is not, and during the 
preceding 60 calendar days has not been, generally 
paying the debts of the regulated entity (other than 
debts that are the subject of a bona fide dispute) as 
such debts become due. 
‘‘(B) PERIODIC
DETERMINATION
REQUIRED
FOR
CRITI-
CALLY UNDERCAPITALIZED REGULATED ENTITY.—If a regu-
lated entity is critically undercapitalized, the Director shall 
make a determination, in writing, as to whether the regu-
lated entity meets the criteria specified in clause (i) or 
(ii) of subparagraph (A)— 
‘‘(i) not later than 30 calendar days after the regu-
lated entity initially becomes critically undercapital-
ized; and 
‘‘(ii) at least once during each succeeding 30-cal-
endar day period. 
‘‘(C) DETERMINATION NOT REQUIRED IF RECEIVERSHIP 
ALREADY IN PLACE.—Subparagraph (B) does not apply with 
respect to a regulated entity in any period during which 
the Agency serves as receiver for the regulated entity. 
‘‘(D) RECEIVERSHIP
TERMINATES
CONSERVATORSHIP.— 
The appointment of the Agency as receiver of a regulated 
entity under this section shall immediately terminate any 
conservatorship established for the regulated entity under 
this title. 
‘‘(5) JUDICIAL REVIEW.— 
‘‘(A) IN GENERAL.—If the Agency is appointed conser-
vator or receiver under this section, the regulated entity 
may, within 30 days of such appointment, bring an action 
in the United States district court for the judicial district 
in which the home office of such regulated entity is located, 
or in the United States District Court for the District 
of Columbia, for an order requiring the Agency to remove 
itself as conservator or receiver. 
‘‘(B) REVIEW.—Upon the filing of an action under 
subparagraph (A), the court shall, upon the merits, dismiss 
such action or direct the Agency to remove itself as such 
conservator or receiver. 
‘‘(6) DIRECTORS NOT LIABLE FOR ACQUIESCING IN APPOINT-
MENT
OF
CONSERVATOR
OR
RECEIVER.—The members of the 
board of directors of a regulated entity shall not be liable 
to the shareholders or creditors of the regulated entity for 
acquiescing in or consenting in good faith to the appointment 
of the Agency as conservator or receiver for that regulated 
entity. 
‘‘(7) AGENCY
NOT
SUBJECT
TO
ANY
OTHER
FEDERAL 
AGENCY.—When acting as conservator or receiver, the Agency 
shall not be subject to the direction or supervision of any 
other agency of the United States or any State in the exercise 
of the rights, powers, and privileges of the Agency. 
Deadline. 
Deadlines. 
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122 STAT. 2737 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(b) POWERS AND DUTIES OF THE AGENCY AS CONSERVATOR 
OR RECEIVER.— 
‘‘(1) RULEMAKING AUTHORITY OF THE AGENCY.—The Agency 
may prescribe such regulations as the Agency determines to 
be appropriate regarding the conduct of conservatorships or 
receiverships. 
‘‘(2) GENERAL POWERS.— 
‘‘(A) SUCCESSOR TO REGULATED ENTITY.—The Agency 
shall, as conservator or receiver, and by operation of law, 
immediately succeed to— 
‘‘(i) all rights, titles, powers, and privileges of the 
regulated entity, and of any stockholder, officer, or 
director of such regulated entity with respect to the 
regulated entity and the assets of the regulated entity; 
and 
‘‘(ii) title to the books, records, and assets of any 
other legal custodian of such regulated entity. 
‘‘(B) OPERATE
THE
REGULATED
ENTITY.—The Agency 
may, as conservator or receiver— 
‘‘(i) take over the assets of and operate the regu-
lated entity with all the powers of the shareholders, 
the directors, and the officers of the regulated entity 
and conduct all business of the regulated entity; 
‘‘(ii) collect all obligations and money due the regu-
lated entity; 
‘‘(iii) perform all functions of the regulated entity 
in the name of the regulated entity which are con-
sistent with the appointment as conservator or 
receiver; 
‘‘(iv) preserve and conserve the assets and property 
of the regulated entity; and 
‘‘(v) provide by contract for assistance in fulfilling 
any function, activity, action, or duty of the Agency 
as conservator or receiver. 
‘‘(C) FUNCTIONS OF OFFICERS, DIRECTORS, AND SHARE-
HOLDERS OF A REGULATED ENTITY.—The Agency may, by 
regulation or order, provide for the exercise of any function 
by any stockholder, director, or officer of any regulated 
entity for which the Agency has been named conservator 
or receiver. 
‘‘(D) POWERS AS CONSERVATOR.—The Agency may, as 
conservator, take such action as may be— 
‘‘(i) necessary to put the regulated entity in a sound 
and solvent condition; and 
‘‘(ii) appropriate to carry on the business of the 
regulated entity and preserve and conserve the assets 
and property of the regulated entity. 
‘‘(E) ADDITIONAL POWERS AS RECEIVER.—In any case 
in which the Agency is acting as receiver, the Agency 
shall place the regulated entity in liquidation and proceed 
to realize upon the assets of the regulated entity in such 
manner as the Agency deems appropriate, including 
through the sale of assets, the transfer of assets to a 
limited-life regulated entity established under subsection 
(i), or the exercise of any other rights or privileges granted 
to the Agency under this paragraph. 
Regulations. 
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122 STAT. 2738 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(F) ORGANIZATION OF NEW ENTERPRISE.—The Agency 
may, as receiver for an enterprise, organize a successor 
enterprise that will operate pursuant to subsection (i). 
‘‘(G) TRANSFER OR SALE OF ASSETS AND LIABILITIES.— 
The Agency may, as conservator or receiver, transfer or 
sell any asset or liability of the regulated entity in default, 
and may do so without any approval, assignment, or con-
sent with respect to such transfer or sale. 
‘‘(H) PAYMENT
OF
VALID
OBLIGATIONS.—The Agency, 
as conservator or receiver, shall, to the extent of proceeds 
realized from the performance of contracts or sale of the 
assets of a regulated entity, pay all valid obligations of 
the regulated entity that are due and payable at the time 
of the appointment of the Agency as conservator or receiver, 
in accordance with the prescriptions and limitations of 
this section. 
‘‘(I) SUBPOENA AUTHORITY.— 
‘‘(i) IN GENERAL.— 
‘‘(I) AGENCY AUTHORITY.—The Agency may, as 
conservator or receiver, and for purposes of car-
rying out any power, authority, or duty with 
respect to a regulated entity (including deter-
mining any claim against the regulated entity and 
determining and realizing upon any asset of any 
person in the course of collecting money due the 
regulated entity), exercise any power established 
under section 1348. 
‘‘(II) APPLICABILITY OF LAW.—The provisions 
of section 1348 shall apply with respect to the 
exercise of any power under this subparagraph, 
in the same manner as such provisions apply under 
that section. 
‘‘(ii) SUBPOENA.—A subpoena or subpoena duces 
tecum may be issued under clause (i) only by, or with 
the written approval of, the Director, or the designee 
of the Director. 
‘‘(iii) RULE
OF
CONSTRUCTION.—This subsection 
shall not be construed to limit any rights that the 
Agency, in any capacity, might otherwise have under 
section 1317 or 1379B. 
‘‘(J) INCIDENTAL POWERS.—The Agency may, as conser-
vator or receiver— 
‘‘(i) exercise all powers and authorities specifically 
granted to conservators or receivers, respectively, 
under this section, and such incidental powers as shall 
be necessary to carry out such powers; and 
‘‘(ii) take any action authorized by this section, 
which the Agency determines is in the best interests 
of the regulated entity or the Agency. 
‘‘(K) OTHER PROVISIONS.— 
‘‘(i) SHAREHOLDERS
AND
CREDITORS
OF
FAILED 
REGULATED ENTITY.—Notwithstanding any other provi-
sion of law, the appointment of the Agency as receiver 
for a regulated entity pursuant to paragraph (2) or 
(4) of subsection (a) and its succession, by operation 
of law, to the rights, titles, powers, and privileges 
described in subsection (b)(2)(A) shall terminate all 
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122 STAT. 2739 
PUBLIC LAW 110–289—JULY 30, 2008 
rights and claims that the stockholders and creditors 
of the regulated entity may have against the assets 
or charter of the regulated entity or the Agency arising 
as a result of their status as stockholders or creditors, 
except for their right to payment, resolution, or other 
satisfaction of their claims, as permitted under sub-
sections (b)(9), (c), and (e). 
‘‘(ii) ASSETS
OF
REGULATED
ENTITY.—Notwith-
standing any other provision of law, for purposes of 
this section, the charter of a regulated entity shall 
not be considered an asset of the regulated entity. 
‘‘(3) AUTHORITY OF RECEIVER TO DETERMINE CLAIMS.— 
‘‘(A) IN GENERAL.—The Agency may, as receiver, deter-
mine claims in accordance with the requirements of this 
subsection and any regulations prescribed under paragraph 
(4). 
‘‘(B) NOTICE REQUIREMENTS.—The receiver, in any case 
involving the liquidation or winding up of the affairs of 
a closed regulated entity, shall— 
‘‘(i) promptly publish a notice to the creditors of 
the regulated entity to present their claims, together 
with proof, to the receiver by a date specified in the 
notice which shall be not less than 90 days after the 
date of publication of such notice; and 
‘‘(ii) republish such notice approximately 1 month 
and 2 months, respectively, after the date of publication 
under clause (i). 
‘‘(C) MAILING
REQUIRED.—The receiver shall mail a 
notice similar to the notice published under subparagraph 
(B)(i) at the time of such publication to any creditor shown 
on the books of the regulated entity— 
‘‘(i) at the last address of the creditor appearing 
in such books; or 
‘‘(ii) upon discovery of the name and address of 
a claimant not appearing on the books of the regulated 
entity, within 30 days after the discovery of such name 
and address. 
‘‘(4) RULEMAKING AUTHORITY RELATING TO DETERMINATION 
OF CLAIMS.—Subject to subsection (c), the Director may pre-
scribe regulations regarding the allowance or disallowance of 
claims by the receiver and providing for administrative deter-
mination of claims and review of such determination. 
‘‘(5) PROCEDURES FOR DETERMINATION OF CLAIMS.— 
‘‘(A) DETERMINATION PERIOD.— 
‘‘(i) IN GENERAL.—Before the end of the 180-day 
period beginning on the date on which any claim 
against a regulated entity is filed with the Agency 
as receiver, the Agency shall determine whether to 
allow or disallow the claim and shall notify the claim-
ant of any determination with respect to such claim. 
‘‘(ii) EXTENSION
OF
TIME.—The period described 
in clause (i) may be extended by a written agreement 
between the claimant and the Agency. 
‘‘(iii) MAILING OF NOTICE SUFFICIENT.—The require-
ments of clause (i) shall be deemed to be satisfied 
if the notice of any determination with respect to any 
Deadline. 
Notification. 
Deadline. 
Notice. 
Publication. 
Deadline. 
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122 STAT. 2740 
PUBLIC LAW 110–289—JULY 30, 2008 
claim is mailed to the last address of the claimant 
which appears— 
‘‘(I) on the books of the regulated entity; 
‘‘(II) in the claim filed by the claimant; or 
‘‘(III) in documents submitted in proof of the 
claim. 
‘‘(iv) CONTENTS OF NOTICE OF DISALLOWANCE.—If 
any claim filed under clause (i) is disallowed, the notice 
to the claimant shall contain— 
‘‘(I) a statement of each reason for the dis-
allowance; and 
‘‘(II) the procedures available for obtaining 
agency review of the determination to disallow 
the claim or judicial determination of the claim. 
‘‘(B) ALLOWANCE OF PROVEN CLAIM.—The receiver shall 
allow any claim received on or before the date specified 
in the notice published under paragraph (3)(B)(i) by the 
receiver from any claimant which is proved to the satisfac-
tion of the receiver. 
‘‘(C) DISALLOWANCE
OF
CLAIMS
FILED
AFTER
FILING 
PERIOD.—Claims filed after the date specified in the notice 
published under paragraph (3)(B)(i), or the date specified 
under paragraph (3)(C), shall be disallowed and such dis-
allowance shall be final. 
‘‘(D) AUTHORITY TO DISALLOW CLAIMS.— 
‘‘(i) IN GENERAL.—The receiver may disallow any 
portion of any claim by a creditor or claim of security, 
preference, or priority which is not proved to the satis-
faction of the receiver. 
‘‘(ii) PAYMENTS
TO
LESS
THAN
FULLY
SECURED 
CREDITORS.—In the case of a claim of a creditor against 
a regulated entity which is secured by any property 
or other asset of such regulated entity, the receiver— 
‘‘(I) may treat the portion of such claim which 
exceeds an amount equal to the fair market value 
of such property or other asset as an unsecured 
claim against the regulated entity; and 
‘‘(II) may not make any payment with respect 
to such unsecured portion of the claim, other than 
in connection with the disposition of all claims 
of unsecured creditors of the regulated entity. 
‘‘(iii) EXCEPTIONS.—No provision of this paragraph 
shall apply with respect to— 
‘‘(I) any extension of credit from any Federal 
Reserve Bank, Federal Home Loan Bank, or the 
United States Treasury; or 
‘‘(II) any security interest in the assets of the 
regulated entity securing any such extension of 
credit. 
‘‘(E) NO JUDICIAL REVIEW OF DETERMINATION PURSUANT 
TO SUBPARAGRAPH (D).—No court may review the deter-
mination of the Agency under subparagraph (D) to disallow 
a claim. 
‘‘(F) LEGAL EFFECT OF FILING.— 
‘‘(i) STATUTE OF LIMITATION TOLLED.—For purposes 
of any applicable statute of limitations, the filing of 
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122 STAT. 2741 
PUBLIC LAW 110–289—JULY 30, 2008 
a claim with the receiver shall constitute a commence-
ment of an action. 
‘‘(ii) NO
PREJUDICE
TO
OTHER
ACTIONS.—Subject 
to paragraph (10), the filing of a claim with the receiver 
shall not prejudice any right of the claimant to continue 
any action which was filed before the date of the 
appointment of the receiver, subject to the determina-
tion of claims by the receiver. 
‘‘(6) PROVISION FOR JUDICIAL DETERMINATION OF CLAIMS.— 
‘‘(A) IN GENERAL.—The claimant may file suit on a 
claim (or continue an action commenced before the appoint-
ment of the receiver) in the district or territorial court 
of the United States for the district within which the prin-
cipal place of business of the regulated entity is located 
or the United States District Court for the District of 
Columbia (and such court shall have jurisdiction to hear 
such claim), before the end of the 60-day period beginning 
on the earlier of— 
‘‘(i) the end of the period described in paragraph 
(5)(A)(i) with respect to any claim against a regulated 
entity for which the Agency is receiver; or 
‘‘(ii) the date of any notice of disallowance of such 
claim pursuant to paragraph (5)(A)(i). 
‘‘(B) STATUTE
OF
LIMITATIONS.—A claim shall be 
deemed to be disallowed (other than any portion of such 
claim which was allowed by the receiver), and such dis-
allowance shall be final, and the claimant shall have no 
further rights or remedies with respect to such claim, if 
the claimant fails, before the end of the 60-day period 
described under subparagraph (A), to file suit on such 
claim (or continue an action commenced before the appoint-
ment of the receiver). 
‘‘(7) REVIEW OF CLAIMS.— 
‘‘(A) OTHER REVIEW PROCEDURES.— 
‘‘(i) IN GENERAL.—The Agency shall establish such 
alternative dispute resolution processes as may be 
appropriate for the resolution of claims filed under 
paragraph (5)(A)(i). 
‘‘(ii) CRITERIA.—In establishing alternative dispute 
resolution processes, the Agency shall strive for proce-
dures which are expeditious, fair, independent, and 
low cost. 
‘‘(iii) VOLUNTARY BINDING OR NONBINDING PROCE-
DURES.—The Agency may establish both binding and 
nonbinding processes under this subparagraph, which 
may be conducted by any government or private party. 
All parties, including the claimant and the Agency, 
must agree to the use of the process in a particular 
case. 
‘‘(B) CONSIDERATION OF INCENTIVES.—The Agency shall 
seek to develop incentives for claimants to participate in 
the alternative dispute resolution process. 
‘‘(8) EXPEDITED DETERMINATION OF CLAIMS.— 
‘‘(A) ESTABLISHMENT
REQUIRED.—The Agency shall 
establish a procedure for expedited relief outside of the 
routine claims process established under paragraph (5) for 
claimants who— 
Procedures. 
Deadline. 
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122 STAT. 2742 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) allege the existence of legally valid and enforce-
able or perfected security interests in assets of any 
regulated entity for which the Agency has been 
appointed receiver; and 
‘‘(ii) allege that irreparable injury will occur if 
the routine claims procedure is followed. 
‘‘(B) DETERMINATION PERIOD.—Before the end of the 
90-day period beginning on the date on which any claim 
is filed in accordance with the procedures established under 
subparagraph (A), the Director shall— 
‘‘(i) determine— 
‘‘(I) whether to allow or disallow such claim; 
or 
‘‘(II) whether such claim should be determined 
pursuant to the procedures established under para-
graph (5); and 
‘‘(ii) notify the claimant of the determination, and 
if the claim is disallowed, provide a statement of each 
reason for the disallowance and the procedure for 
obtaining agency review or judicial determination. 
‘‘(C) PERIOD
FOR
FILING
OR
RENEWING
SUIT.—Any 
claimant who files a request for expedited relief shall be 
permitted to file a suit, or to continue a suit filed before 
the date of appointment of the receiver, seeking a deter-
mination of the rights of the claimant with respect to 
such security interest after the earlier of— 
‘‘(i) the end of the 90-day period beginning on 
the date of the filing of a request for expedited relief; 
or 
‘‘(ii) the date on which the Agency denies the claim. 
‘‘(D) STATUTE OF LIMITATIONS.—If an action described 
under subparagraph (C) is not filed, or the motion to renew 
a previously filed suit is not made, before the end of the 
30-day period beginning on the date on which such action 
or motion may be filed under subparagraph (B), the claim 
shall be deemed to be disallowed as of the end of such 
period (other than any portion of such claim which was 
allowed by the receiver), such disallowance shall be final, 
and the claimant shall have no further rights or remedies 
with respect to such claim. 
‘‘(E) LEGAL EFFECT OF FILING.— 
‘‘(i) STATUTE OF LIMITATION TOLLED.—For purposes 
of any applicable statute of limitations, the filing of 
a claim with the receiver shall constitute a commence-
ment of an action. 
‘‘(ii) NO
PREJUDICE
TO
OTHER
ACTIONS.—Subject 
to paragraph (10), the filing of a claim with the receiver 
shall not prejudice any right of the claimant to continue 
any action that was filed before the appointment of 
the receiver, subject to the determination of claims 
by the receiver. 
‘‘(9) PAYMENT OF CLAIMS.— 
‘‘(A) IN GENERAL.—The receiver may, in the discretion 
of the receiver, and to the extent that funds are available 
from the assets of the regulated entity, pay creditor claims, 
in such manner and amounts as are authorized under 
this section, which are— 
Deadline. 
Notification. 
Deadline. 
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122 STAT. 2743 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) allowed by the receiver; 
‘‘(ii) approved by the Agency pursuant to a final 
determination pursuant to paragraph (7) or (8); or 
‘‘(iii) determined by the final judgment of any court 
of competent jurisdiction. 
‘‘(B) AGREEMENTS
AGAINST
THE
INTEREST
OF
THE 
AGENCY.—No agreement that tends to diminish or defeat 
the interest of the Agency in any asset acquired by the 
Agency as receiver under this section shall be valid against 
the Agency unless such agreement is in writing and 
executed by an authorized officer or representative of the 
regulated entity. 
‘‘(C) PAYMENT OF DIVIDENDS ON CLAIMS.—The receiver 
may, in the sole discretion of the receiver, pay from the 
assets of the regulated entity dividends on proved claims 
at any time, and no liability shall attach to the Agency 
by reason of any such payment, for failure to pay dividends 
to a claimant whose claim is not proved at the time of 
any such payment. 
‘‘(D) RULEMAKING AUTHORITY OF THE DIRECTOR.—The 
Director may prescribe such rules, including definitions 
of terms, as the Director deems appropriate to establish 
a single uniform interest rate for, or to make payments 
of post-insolvency interest to creditors holding proven 
claims against the receivership estates of the regulated 
entity, following satisfaction by the receiver of the principal 
amount of all creditor claims. 
‘‘(10) SUSPENSION OF LEGAL ACTIONS.— 
‘‘(A) IN GENERAL.—After the appointment of a conser-
vator or receiver for a regulated entity, the conservator 
or receiver may, in any judicial action or proceeding to 
which such regulated entity is or becomes a party, request 
a stay for a period not to exceed— 
‘‘(i) 45 days, in the case of any conservator; and 
‘‘(ii) 90 days, in the case of any receiver. 
‘‘(B) GRANT OF STAY BY ALL COURTS REQUIRED.—Upon 
receipt of a request by the conservator or receiver under 
subparagraph (A) for a stay of any judicial action or pro-
ceeding in any court with jurisdiction of such action or 
proceeding, the court shall grant such stay as to all parties. 
‘‘(11) ADDITIONAL RIGHTS AND DUTIES.— 
‘‘(A) PRIOR
FINAL
ADJUDICATION.—The Agency shall 
abide by any final unappealable judgment of any court 
of competent jurisdiction which was rendered before the 
appointment of the Agency as conservator or receiver. 
‘‘(B) RIGHTS
AND
REMEDIES
OF
CONSERVATOR
OR 
RECEIVER.—In the event of any appealable judgment, the 
Agency as conservator or receiver— 
‘‘(i) shall have all of the rights and remedies avail-
able to the regulated entity (before the appointment 
of such conservator or receiver) and the Agency, 
including removal to Federal court and all appellate 
rights; and 
‘‘(ii) shall not be required to post any bond in 
order to pursue such remedies. 
‘‘(C) NO ATTACHMENT OR EXECUTION.—No attachment 
or execution may issue by any court upon assets in the 
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122 STAT. 2744 
PUBLIC LAW 110–289—JULY 30, 2008 
possession of the receiver, or upon the charter, of a regu-
lated entity for which the Agency has been appointed 
receiver. 
‘‘(D) LIMITATION
ON
JUDICIAL
REVIEW.—Except as 
otherwise provided in this subsection, no court shall have 
jurisdiction over— 
‘‘(i) any claim or action for payment from, or any 
action seeking a determination of rights with respect 
to, the assets or charter of any regulated entity for 
which the Agency has been appointed receiver; or 
‘‘(ii) any claim relating to any act or omission 
of such regulated entity or the Agency as receiver. 
‘‘(E) DISPOSITION OF ASSETS.—In exercising any right, 
power, privilege, or authority as conservator or receiver 
in connection with any sale or disposition of assets of 
a regulated entity for which the Agency has been appointed 
conservator or receiver, the Agency shall conduct its oper-
ations in a manner which— 
‘‘(i) maximizes the net present value return from 
the sale or disposition of such assets; 
‘‘(ii) minimizes the amount of any loss realized 
in the resolution of cases; and 
‘‘(iii) ensures adequate competition and fair and 
consistent treatment of offerors. 
‘‘(12) STATUTE OF LIMITATIONS FOR ACTIONS BROUGHT BY 
CONSERVATOR OR RECEIVER.— 
‘‘(A) IN GENERAL.—Notwithstanding any provision of 
any contract, the applicable statute of limitations with 
regard to any action brought by the Agency as conservator 
or receiver shall be— 
‘‘(i) in the case of any contract claim, the longer 
of— 
‘‘(I) the 6-year period beginning on the date 
on which the claim accrues; or 
‘‘(II) the period applicable under State law; 
and 
‘‘(ii) in the case of any tort claim, the longer of— 
‘‘(I) the 3-year period beginning on the date 
on which the claim accrues; or 
‘‘(II) the period applicable under State law. 
‘‘(B) DETERMINATION OF THE DATE ON WHICH A CLAIM 
ACCRUES.—For purposes of subparagraph (A), the date on 
which the statute of limitations begins to run on any claim 
described in such subparagraph shall be the later of— 
‘‘(i) the date of the appointment of the Agency 
as conservator or receiver; or 
‘‘(ii) the date on which the cause of action accrues. 
‘‘(13) REVIVAL OF EXPIRED STATE CAUSES OF ACTION.— 
‘‘(A) IN
GENERAL.—In the case of any tort claim 
described under clause (ii) for which the statute of limita-
tions applicable under State law with respect to such claim 
has expired not more than 5 years before the appointment 
of the Agency as conservator or receiver, the Agency may 
bring an action as conservator or receiver on such claim 
without regard to the expiration of the statute of limitations 
applicable under State law. 
Effective date. 
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122 STAT. 2745 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) CLAIMS DESCRIBED.—A tort claim referred to under 
clause (i) is a claim arising from fraud, intentional mis-
conduct resulting in unjust enrichment, or intentional mis-
conduct resulting in substantial loss to the regulated entity. 
‘‘(14) ACCOUNTING AND RECORDKEEPING REQUIREMENTS.— 
‘‘(A) IN
GENERAL.—The Agency as conservator or 
receiver shall, consistent with the accounting and reporting 
practices and procedures established by the Agency, main-
tain a full accounting of each conservatorship and receiver-
ship or other disposition of a regulated entity in default. 
‘‘(B) ANNUAL ACCOUNTING OR REPORT.—With respect 
to each conservatorship or receivership, the Agency shall 
make an annual accounting or report available to the 
Board, the Comptroller General of the United States, the 
Committee on Banking, Housing, and Urban Affairs of 
the Senate, and the Committee on Financial Services of 
the House of Representatives. 
‘‘(C) AVAILABILITY OF REPORTS.—Any report prepared 
under subparagraph (B) shall be made available by the 
Agency upon request to any shareholder of a regulated 
entity or any member of the public. 
‘‘(D) RECORDKEEPING REQUIREMENT.—After the end of 
the 6-year period beginning on the date on which the 
conservatorship or receivership is terminated by the 
Director, the Agency may destroy any records of such regu-
lated entity which the Agency, in the discretion of the 
Agency, determines to be unnecessary, unless directed not 
to do so by a court of competent jurisdiction or govern-
mental agency, or prohibited by law. 
‘‘(15) FRAUDULENT TRANSFERS.— 
‘‘(A) IN
GENERAL.—The Agency, as conservator or 
receiver, may avoid a transfer of any interest of an entity- 
affiliated party, or any person determined by the conser-
vator or receiver to be a debtor of the regulated entity, 
in property, or any obligation incurred by such party or 
person, that was made within 5 years of the date on which 
the Agency was appointed conservator or receiver, if such 
party or person voluntarily or involuntarily made such 
transfer or incurred such liability with the intent to hinder, 
delay, or defraud the regulated entity, the Agency, the 
conservator, or receiver. 
‘‘(B) RIGHT OF RECOVERY.—To the extent a transfer 
is avoided under subparagraph (A), the conservator or 
receiver may recover, for the benefit of the regulated entity, 
the property transferred, or, if a court so orders, the value 
of such property (at the time of such transfer) from— 
‘‘(i) the initial transferee of such transfer or the 
entity-affiliated party or person for whose benefit such 
transfer was made; or 
‘‘(ii) any immediate or mediate transferee of any 
such initial transferee. 
‘‘(C) RIGHTS OF TRANSFEREE OR OBLIGEE.—The conser-
vator or receiver may not recover under subparagraph (B) 
from— 
‘‘(i) any transferee that takes for value, including 
satisfaction or securing of a present or antecedent debt, 
in good faith; or 
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122 STAT. 2746 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) any immediate or mediate good faith trans-
feree of such transferee. 
‘‘(D) RIGHTS UNDER THIS PARAGRAPH.—The rights under 
this paragraph of the conservator or receiver described 
under subparagraph (A) shall be superior to any rights 
of a trustee or any other party (other than any party 
which is a Federal agency) under title 11, United States 
Code. 
‘‘(16) ATTACHMENT
OF
ASSETS
AND
OTHER
INJUNCTIVE 
RELIEF.—Subject to paragraph (17), any court of competent 
jurisdiction may, at the request of the conservator or receiver, 
issue an order in accordance with rule 65 of the Federal Rules 
of Civil Procedure, including an order placing the assets of 
any person designated by the conservator or receiver under 
the control of the court, and appointing a trustee to hold such 
assets. 
‘‘(17) STANDARDS OF PROOF.—Rule 65 of the Federal Rules 
of Civil Procedure shall apply with respect to any proceeding 
under paragraph (16) without regard to the requirement of 
such rule that the applicant show that the injury, loss, or 
damage is irreparable and immediate. 
‘‘(18) TREATMENT OF CLAIMS ARISING FROM BREACH OF CON-
TRACTS EXECUTED BY THE CONSERVATOR OR RECEIVER.— 
‘‘(A) IN GENERAL.—Notwithstanding any other provi-
sion of this subsection, any final and unappealable judg-
ment for monetary damages entered against the conser-
vator or receiver for the breach of an agreement executed 
or approved in writing by the conservator or receiver after 
the date of its appointment, shall be paid as an administra-
tive expense of the conservator or receiver. 
‘‘(B) NO LIMITATION OF POWER.—Nothing in this para-
graph shall be construed to limit the power of the conser-
vator or receiver to exercise any rights under contract 
or law, including to terminate, breach, cancel, or otherwise 
discontinue such agreement. 
‘‘(19) GENERAL EXCEPTIONS.— 
‘‘(A) LIMITATIONS.—The rights of the conservator or 
receiver appointed under this section shall be subject to 
the limitations on the powers of a receiver under sections 
402 through 407 of the Federal Deposit Insurance Corpora-
tion Improvement Act of 1991 (12 U.S.C. 4402 through 
4407). 
‘‘(B) MORTGAGES HELD IN TRUST.— 
‘‘(i) IN GENERAL.—Any mortgage, pool of mortgages, 
or interest in a pool of mortgages held in trust, custo-
dial, or agency capacity by a regulated entity for the 
benefit of any person other than the regulated entity 
shall not be available to satisfy the claims of creditors 
generally, except that nothing in this clause shall be 
construed to expand or otherwise affect the authority 
of any regulated entity. 
‘‘(ii) HOLDING OF MORTGAGES.—Any mortgage, pool 
of mortgages, or interest in a pool of mortgages 
described in clause (i) shall be held by the conservator 
or receiver appointed under this section for the bene-
ficial owners of such mortgage, pool of mortgages, or 
interest in accordance with the terms of the agreement 
Applicability. 
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122 STAT. 2747 
PUBLIC LAW 110–289—JULY 30, 2008 
creating such trust, custodial, or other agency arrange-
ment. 
‘‘(iii) LIABILITY OF CONSERVATOR OR RECEIVER.— 
The liability of the conservator or receiver appointed 
under this section for damages shall, in the case of 
any contingent or unliquidated claim relating to the 
mortgages held in trust, be estimated in accordance 
with the regulations of the Director. 
‘‘(c) PRIORITY OF EXPENSES AND UNSECURED CLAIMS.— 
‘‘(1) IN GENERAL.—Unsecured claims against a regulated 
entity, or the receiver therefor, that are proven to the satisfac-
tion of the receiver shall have priority in the following order: 
‘‘(A) Administrative expenses of the receiver. 
‘‘(B) Any other general or senior liability of the regu-
lated entity (which is not a liability described under 
subparagraph (C) or (D). 
‘‘(C) Any obligation subordinated to general creditors 
(which is not an obligation described under subparagraph 
(D)). 
‘‘(D) Any obligation to shareholders or members arising 
as a result of their status as shareholder or members. 
‘‘(2) CREDITORS SIMILARLY SITUATED.—All creditors that are 
similarly situated under paragraph (1) shall be treated in a 
similar manner, except that the receiver may take any action 
(including making payments) that does not comply with this 
subsection, if— 
‘‘(A) the Director determines that such action is nec-
essary to maximize the value of the assets of the regulated 
entity, to maximize the present value return from the 
sale or other disposition of the assets of the regulated 
entity, or to minimize the amount of any loss realized 
upon the sale or other disposition of the assets of the 
regulated entity; and 
‘‘(B) all creditors that are similarly situated under 
paragraph (1) receive not less than the amount provided 
in subsection (e)(2). 
‘‘(3) DEFINITION.—As used in this subsection, the term 
‘administrative expenses of the receiver’ includes— 
‘‘(A) the actual, necessary costs and expenses incurred 
by the receiver in preserving the assets of a failed regulated 
entity or liquidating or otherwise resolving the affairs of 
a failed regulated entity; and 
‘‘(B) any obligations that the receiver determines are 
necessary and appropriate to facilitate the smooth and 
orderly liquidation or other resolution of the regulated 
entity. 
‘‘(d) PROVISIONS
RELATING
TO
CONTRACTS
ENTERED
INTO 
BEFORE APPOINTMENT OF CONSERVATOR OR RECEIVER.— 
‘‘(1) AUTHORITY TO REPUDIATE CONTRACTS.—In addition to 
any other rights a conservator or receiver may have, the conser-
vator or receiver for any regulated entity may disaffirm or 
repudiate any contract or lease— 
‘‘(A) to which such regulated entity is a party; 
‘‘(B) the performance of which the conservator or 
receiver, in its sole discretion, determines to be burden-
some; and 
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122 STAT. 2748 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) the disaffirmance or repudiation of which the con-
servator or receiver determines, in its sole discretion, will 
promote the orderly administration of the affairs of the 
regulated entity. 
‘‘(2) TIMING OF REPUDIATION.—The conservator or receiver 
shall determine whether or not to exercise the rights of repudi-
ation under this subsection within a reasonable period following 
such appointment. 
‘‘(3) CLAIMS FOR DAMAGES FOR REPUDIATION.— 
‘‘(A) IN GENERAL.—Except as otherwise provided under 
subparagraph (C) and paragraphs (4), (5), and (6), the 
liability of the conservator or receiver for the disaffirmance 
or repudiation of any contract pursuant to paragraph (1) 
shall be— 
‘‘(i) limited to actual direct compensatory damages; 
and 
‘‘(ii) determined as of— 
‘‘(I) the date of the appointment of the conser-
vator or receiver; or 
‘‘(II) in the case of any contract or agreement 
referred to in paragraph (8), the date of the 
disaffirmance or repudiation of such contract or 
agreement. 
‘‘(B) NO LIABILITY FOR OTHER DAMAGES.—For purposes 
of subparagraph (A), the term ‘actual direct compensatory 
damages’ shall not include— 
‘‘(i) punitive or exemplary damages; 
‘‘(ii) damages for lost profits or opportunity; or 
‘‘(iii) damages for pain and suffering. 
‘‘(C) MEASURE OF DAMAGES FOR REPUDIATION OF FINAN-
CIAL CONTRACTS.—In the case of any qualified financial 
contract or agreement to which paragraph (8) applies, 
compensatory damages shall be— 
‘‘(i) deemed to include normal and reasonable costs 
of cover or other reasonable measures of damages uti-
lized in the industries for such contract and agreement 
claims; and 
‘‘(ii) paid in accordance with this subsection and 
subsection (e), except as otherwise specifically provided 
in this section. 
‘‘(4) LEASES UNDER WHICH THE REGULATED ENTITY IS THE 
LESSEE.— 
‘‘(A) IN GENERAL.—If the conservator or receiver dis-
affirms or repudiates a lease under which the regulated 
entity was the lessee, the conservator or receiver shall 
not be liable for any damages (other than damages deter-
mined under subparagraph (B)) for the disaffirmance or 
repudiation of such lease. 
‘‘(B) PAYMENTS OF RENT.—Notwithstanding subpara-
graph (A), the lessor under a lease to which that subpara-
graph applies shall— 
‘‘(i) be entitled to the contractual rent accruing 
before the later of the date on which— 
‘‘(I) the notice of disaffirmance or repudiation 
is mailed; or 
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122 STAT. 2749 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(II) the disaffirmance or repudiation becomes 
effective, unless the lessor is in default or breach 
of the terms of the lease; 
‘‘(ii) have no claim for damages under any accelera-
tion clause or other penalty provision in the lease; 
and 
‘‘(iii) have a claim for any unpaid rent, subject 
to all appropriate offsets and defenses, due as of the 
date of the appointment, which shall be paid in accord-
ance with this subsection and subsection (e). 
‘‘(5) LEASES UNDER WHICH THE REGULATED ENTITY IS THE 
LESSOR.— 
‘‘(A) IN GENERAL.—If the conservator or receiver repudi-
ates an unexpired written lease of real property of the 
regulated entity under which the regulated entity is the 
lessor and the lessee is not, as of the date of such repudi-
ation, in default, the lessee under such lease may either— 
‘‘(i) treat the lease as terminated by such repudi-
ation; or 
‘‘(ii) remain in possession of the leasehold interest 
for the balance of the term of the lease, unless the 
lessee defaults under the terms of the lease after the 
date of such repudiation. 
‘‘(B) PROVISIONS APPLICABLE TO LESSEE REMAINING IN 
POSSESSION.—If any lessee under a lease described under 
subparagraph (A) remains in possession of a leasehold 
interest under clause (ii) of subparagraph (A)— 
‘‘(i) the lessee— 
‘‘(I) shall continue to pay the contractual rent 
pursuant to the terms of the lease after the date 
of the repudiation of such lease; and 
‘‘(II) may offset against any rent payment 
which accrues after the date of the repudiation 
of the lease, and any damages which accrue after 
such date due to the nonperformance of any obliga-
tion of the regulated entity under the lease after 
such date; and 
‘‘(ii) the conservator or receiver shall not be liable 
to the lessee for any damages arising after such date 
as a result of the repudiation, other than the amount 
of any offset allowed under clause (i)(II). 
‘‘(6) CONTRACTS FOR THE SALE OF REAL PROPERTY.— 
‘‘(A) IN GENERAL.—If the conservator or receiver repudi-
ates any contract for the sale of real property and the 
purchaser of such real property under such contract is 
in possession, and is not, as of the date of such repudiation, 
in default, such purchaser may either— 
‘‘(i) treat the contract as terminated by such 
repudiation; or 
‘‘(ii) remain in possession of such real property. 
‘‘(B) PROVISIONS APPLICABLE TO PURCHASER REMAINING 
IN POSSESSION.—If any purchaser of real property under 
any contract described under subparagraph (A) remains 
in possession of such property under clause (ii) of subpara-
graph (A)— 
‘‘(i) the purchaser— 
Payments. 
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122 STAT. 2750 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(I) shall continue to make all payments due 
under the contract after the date of the repudiation 
of the contract; and 
‘‘(II) may offset against any such payments 
any damages which accrue after such date due 
to the nonperformance (after such date) of any 
obligation of the regulated entity under the con-
tract; and 
‘‘(ii) the conservator or receiver shall— 
‘‘(I) not be liable to the purchaser for any 
damages arising after such date as a result of 
the repudiation, other than the amount of any 
offset allowed under clause (i)(II); 
‘‘(II) deliver title to the purchaser in accord-
ance with the provisions of the contract; and 
‘‘(III) have no obligation under the contract 
other than the performance required under sub-
clause (II). 
‘‘(C) ASSIGNMENT AND SALE ALLOWED.— 
‘‘(i) IN GENERAL.—No provision of this paragraph 
shall be construed as limiting the right of the conser-
vator or receiver to assign the contract described under 
subparagraph (A), and sell the property subject to the 
contract and the provisions of this paragraph. 
‘‘(ii) NO LIABILITY AFTER ASSIGNMENT AND SALE.— 
If an assignment and sale described under clause (i) 
is consummated, the conservator or receiver shall have 
no further liability under the contract described under 
subparagraph (A), or with respect to the real property 
which was the subject of such contract. 
‘‘(7) SERVICE CONTRACTS.— 
‘‘(A) SERVICES PERFORMED BEFORE APPOINTMENT.—In 
the case of any contract for services between any person 
and any regulated entity for which the Agency has been 
appointed conservator or receiver, any claim of such person 
for services performed before the appointment of the conser-
vator or receiver shall be— 
‘‘(i) a claim to be paid in accordance with sub-
sections (b) and (e); and 
‘‘(ii) deemed to have arisen as of the date on which 
the conservator or receiver was appointed. 
‘‘(B) SERVICES
PERFORMED
AFTER
APPOINTMENT
AND 
PRIOR
TO
REPUDIATION.—If, in the case of any contract 
for services described under subparagraph (A), the conser-
vator or receiver accepts performance by the other person 
before the conservator or receiver makes any determination 
to exercise the right of repudiation of such contract under 
this section— 
‘‘(i) the other party shall be paid under the terms 
of the contract for the services performed; and 
‘‘(ii) the amount of such payment shall be treated 
as an administrative expense of the conservatorship 
or receivership. 
‘‘(C) ACCEPTANCE OF PERFORMANCE NO BAR TO SUBSE-
QUENT REPUDIATION.—The acceptance by the conservator 
or receiver of services referred to under subparagraph (B) 
Payments. 
Payments. 
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122 STAT. 2751 
PUBLIC LAW 110–289—JULY 30, 2008 
in connection with a contract described in such subpara-
graph shall not affect the right of the conservator or 
receiver to repudiate such contract under this section at 
any time after such performance. 
‘‘(8) CERTAIN QUALIFIED FINANCIAL CONTRACTS.— 
‘‘(A) RIGHTS
OF
PARTIES
TO
CONTRACTS.—Subject to 
paragraphs (9) and (10), and notwithstanding any other 
provision of this title (other than subsection (b)(9)(B) of 
this section), any other Federal law, or the law of any 
State, no person shall be stayed or prohibited from exer-
cising— 
‘‘(i) any right of that person to cause the termi-
nation, liquidation, or acceleration of any qualified 
financial contract with a regulated entity that arises 
upon the appointment of the Agency as receiver for 
such regulated entity at any time after such appoint-
ment; 
‘‘(ii) any right under any security agreement or 
arrangement or other credit enhancement relating to 
one or more qualified financial contracts; or 
‘‘(iii) any right to offset or net out any termination 
value, payment amount, or other transfer obligation 
arising under or in connection with 1 or more contracts 
and agreements described in clause (i), including any 
master agreement for such contracts or agreements. 
‘‘(B) APPLICABILITY OF OTHER PROVISIONS.—Subsection 
(b)(10) shall apply in the case of any judicial action or 
proceeding brought against any receiver referred to under 
subparagraph (A), or the regulated entity for which such 
receiver was appointed, by any party to a contract or agree-
ment described under subparagraph (A)(i) with such regu-
lated entity. 
‘‘(C) CERTAIN TRANSFERS NOT AVOIDABLE.— 
‘‘(i) IN GENERAL.—Notwithstanding paragraph (11), 
or any other provision of Federal or State law relating 
to the avoidance of preferential or fraudulent transfers, 
the Agency, whether acting as such or as conservator 
or receiver of a regulated entity, may not avoid any 
transfer of money or other property in connection with 
any qualified financial contract with a regulated entity. 
‘‘(ii) EXCEPTION FOR CERTAIN TRANSFERS.—Clause 
(i) shall not apply to any transfer of money or other 
property in connection with any qualified financial con-
tract with a regulated entity if the Agency determines 
that the transferee had actual intent to hinder, delay, 
or defraud such regulated entity, the creditors of such 
regulated entity, or any conservator or receiver 
appointed for such regulated entity. 
‘‘(D) CERTAIN CONTRACTS AND AGREEMENTS DEFINED.— 
In this subsection the following definitions shall apply: 
‘‘(i) QUALIFIED
FINANCIAL
CONTRACT.—The term 
‘qualified financial contract’ means any securities con-
tract, commodity contract, forward contract, repurchase 
agreement, swap agreement, and any similar agree-
ment that the Agency determines by regulation, resolu-
tion, or order to be a qualified financial contract for 
purposes of this paragraph. 
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122 STAT. 2752 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) SECURITIES CONTRACT.—The term ‘securities 
contract’— 
‘‘(I) means a contract for the purchase, sale, 
or loan of a security, a certificate of deposit, a 
mortgage loan, or any interest in a mortgage loan, 
a group or index of securities, certificates of 
deposit, or mortgage loans or interests therein 
(including any interest therein or based on the 
value thereof) or any option on any of the fore-
going, including any option to purchase or sell 
any such security, certificate of deposit, mortgage 
loan, interest, group or index, or option, and 
including any repurchase or reverse repurchase 
transaction on any such security, certificate of 
deposit, mortgage loan, interest, group or index, 
or option; 
‘‘(II) does not include any purchase, sale, or 
repurchase obligation under a participation in a 
commercial mortgage loan, unless the Agency 
determines by regulation, resolution, or order to 
include any such agreement within the meaning 
of such term; 
‘‘(III) means any option entered into on a 
national securities exchange relating to foreign 
currencies; 
‘‘(IV) means the guarantee by or to any securi-
ties clearing agency of any settlement of cash, 
securities, certificates of deposit, mortgage loans 
or interests therein, group or index of securities, 
certificates of deposit, or mortgage loans or 
interests therein (including any interest therein 
or based on the value thereof) or option on any 
of the foregoing, including any option to purchase 
or sell any such security, certificate of deposit, 
mortgage loan, interest, group or index, or option; 
‘‘(V) means any margin loan; 
‘‘(VI) means any other agreement or trans-
action that is similar to any agreement or trans-
action referred to in this clause; 
‘‘(VII) means any combination of the agree-
ments or transactions referred to in this clause; 
‘‘(VIII) means any option to enter into any 
agreement or transaction referred to in this clause; 
‘‘(IX) means a master agreement that provides 
for an agreement or transaction referred to in sub-
clause (I), (III), (IV), (V), (VI), (VII), or (VIII), 
together with all supplements to any such master 
agreement, without regard to whether the master 
agreement provides for an agreement or trans-
action that is not a securities contract under this 
clause, except that the master agreement shall 
be considered to be a securities contract under 
this clause only with respect to each agreement 
or transaction under the master agreement that 
is referred to in subclause (I), (III), (IV), (V), (VI), 
(VII), or (VIII); and 
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122 STAT. 2753 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(X) means any security agreement or arrange-
ment or other credit enhancement related to any 
agreement or transaction referred to in this clause, 
including any guarantee or reimbursement obliga-
tion in connection with any agreement or trans-
action referred to in this clause. 
‘‘(iii) COMMODITY
CONTRACT.—The term ‘com-
modity contract’ means— 
‘‘(I) with respect to a futures commission mer-
chant, a contract for the purchase or sale of a 
commodity for future delivery on, or subject to 
the rules of, a contract market or board of trade; 
‘‘(II) with respect to a foreign futures commis-
sion merchant, a foreign future; 
‘‘(III) with respect to a leverage transaction 
merchant, a leverage transaction; 
‘‘(IV) with respect to a clearing organization, 
a contract for the purchase or sale of a commodity 
for future delivery on, or subject to the rules of, 
a contract market or board of trade that is cleared 
by such clearing organization, or commodity option 
traded on, or subject to the rules of, a contract 
market or board of trade that is cleared by such 
clearing organization; 
‘‘(V) with respect to a commodity options 
dealer, a commodity option; 
‘‘(VI) any other agreement or transaction that 
is similar to any agreement or transaction referred 
to in this clause; 
‘‘(VII) any combination of the agreements or 
transactions referred to in this clause; 
‘‘(VIII) any option to enter into any agreement 
or transaction referred to in this clause; 
‘‘(IX) a master agreement that provides for 
an agreement or transaction referred to in sub-
clause (I), (II), (III), (IV), (V), (VI), (VII), or (VIII), 
together with all supplements to any such master 
agreement, without regard to whether the master 
agreement provides for an agreement or trans-
action that is not a commodity contract under this 
clause, except that the master agreement shall 
be considered to be a commodity contract under 
this clause only with respect to each agreement 
or transaction under the master agreement that 
is referred to in subclause (I), (II), (III), (IV), (V), 
(VI), (VII), or (VIII); or 
‘‘(X) any security agreement or arrangement 
or other credit enhancement related to any agree-
ment or transaction referred to in this clause, 
including any guarantee or reimbursement obliga-
tion in connection with any agreement or trans-
action referred to in this clause. 
‘‘(iv) FORWARD CONTRACT.—The term ‘forward con-
tract’ means— 
‘‘(I) a contract (other than a commodity con-
tract) for the purchase, sale, or transfer of a com-
modity or any similar good, article, service, right, 
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122 STAT. 2754 
PUBLIC LAW 110–289—JULY 30, 2008 
or interest which is presently or in the future 
becomes the subject of dealing in the forward con-
tract trade, or product or byproduct thereof, with 
a maturity date more than 2 days after the date 
on which the contract is entered into, including 
a repurchase transaction, reverse repurchase 
transaction, consignment, lease, swap, hedge 
transaction, deposit, loan, option, allocated trans-
action, unallocated transaction, or any other 
similar agreement; 
‘‘(II) any combination of agreements or trans-
actions referred to in subclauses (I) and (III); 
‘‘(III) any option to enter into any agreement 
or transaction referred to in subclause (I) or (II); 
‘‘(IV) a master agreement that provides for 
an agreement or transaction referred to in sub-
clauses (I), (II), or (III), together with all supple-
ments to any such master agreement, without 
regard to whether the master agreement provides 
for an agreement or transaction that is not a for-
ward contract under this clause, except that the 
master agreement shall be considered to be a for-
ward contract under this clause only with respect 
to each agreement or transaction under the master 
agreement that is referred to in subclause (I), (II), 
or (III); or 
‘‘(V) any security agreement or arrangement 
or other credit enhancement related to any agree-
ment or transaction referred to in subclause (I), 
(II), (III), or (IV), including any guarantee or 
reimbursement obligation in connection with any 
agreement or transaction referred to in any such 
subclause. 
‘‘(v) 
REPURCHASE
AGREEMENT.—The 
term 
‘repurchase agreement’ (including a reverse repurchase 
agreement)— 
‘‘(I) means an agreement, including related 
terms, which provides for the transfer of one or 
more certificates of deposit, mortgage-related secu-
rities (as such term is defined in section 3 of the 
Securities Exchange Act of 1934), mortgage loans, 
interests in mortgage-related securities or mort-
gage loans, eligible bankers’ acceptances, qualified 
foreign government securities (defined for purposes 
of this clause as a security that is a direct obliga-
tion of, or that is fully guaranteed by, the central 
government of a member of the Organization for 
Economic Cooperation and Development, as deter-
mined by regulation or order adopted by the appro-
priate Federal banking authority), or securities 
that are direct obligations of, or that are fully 
guaranteed by, the United States or any agency 
of the United States against the transfer of funds 
by the transferee of such certificates of deposit, 
eligible bankers’ acceptances, securities, mortgage 
loans, or interests with a simultaneous agreement 
by such transferee to transfer to the transferor 
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122 STAT. 2755 
PUBLIC LAW 110–289—JULY 30, 2008 
thereof certificates of deposit, eligible bankers’ 
acceptances, 
securities, 
mortgage 
loans, 
or 
interests as described above, at a date certain not 
later than 1 year after such transfers or on 
demand, against the transfer of funds, or any other 
similar agreement; 
‘‘(II) does not include any repurchase obliga-
tion under a participation in a commercial mort-
gage loan, unless the Agency determines by regula-
tion, resolution, or order to include any such 
participation within the meaning of such term; 
‘‘(III) means any combination of agreements 
or transactions referred to in subclauses (I) and 
(IV); 
‘‘(IV) means any option to enter into any agree-
ment or transaction referred to in subclause (I) 
or (III); 
‘‘(V) means a master agreement that provides 
for an agreement or transaction referred to in sub-
clause (I), (III), or (IV), together with all supple-
ments to any such master agreement, without 
regard to whether the master agreement provides 
for an agreement or transaction that is not a 
repurchase agreement under this clause, except 
that the master agreement shall be considered 
to be a repurchase agreement under this subclause 
only with respect to each agreement or transaction 
under the master agreement that is referred to 
in subclause (I), (III), or (IV); and 
‘‘(VI) means any security agreement or 
arrangement or other credit enhancement related 
to any agreement or transaction referred to in 
subclause (I), (III), (IV), or (V), including any guar-
antee or reimbursement obligation in connection 
with any agreement or transaction referred to in 
any such subclause. 
‘‘(vi) SWAP
AGREEMENT.—The term ‘swap agree-
ment’ means— 
‘‘(I) any agreement, including the terms and 
conditions incorporated by reference in any such 
agreement, which is an interest rate swap, option, 
future, or forward agreement, including a rate 
floor, rate cap, rate collar, cross-currency rate 
swap, and basis swap; a spot, same day-tomorrow, 
tomorrow-next, forward, or other foreign exchange 
or precious metals agreement; a currency swap, 
option, future, or forward agreement; an equity 
index or equity swap, option, future, or forward 
agreement; a debt index or debt swap, option, 
future, or forward agreement; a total return, credit 
spread or credit swap, option, future, or forward 
agreement; a commodity index or commodity swap, 
option, future, or forward agreement; or a weather 
swap, weather derivative, or weather option; 
‘‘(II) any agreement or transaction that is 
similar to any other agreement or transaction 
referred to in this clause and that is of a type 
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122 STAT. 2756 
PUBLIC LAW 110–289—JULY 30, 2008 
that has been, is presently, or in the future 
becomes, the subject of recurrent dealings in the 
swap markets (including terms and conditions 
incorporated by reference in such agreement) and 
that is a forward, swap, future, or option on one 
or more rates, currencies, commodities, equity 
securities or other equity instruments, debt securi-
ties or other debt instruments, quantitative meas-
ures associated with an occurrence, extent of an 
occurrence, or contingency associated with a finan-
cial, commercial, or economic consequence, or eco-
nomic or financial indices or measures of economic 
or financial risk or value; 
‘‘(III) any combination of agreements or trans-
actions referred to in this clause; 
‘‘(IV) any option to enter into any agreement 
or transaction referred to in this clause; 
‘‘(V) a master agreement that provides for an 
agreement or transaction referred to in subclause 
(I), (II), (III), or (IV), together with all supplements 
to any such master agreement, without regard to 
whether the master agreement contains an agree-
ment or transaction that is not a swap agreement 
under this clause, except that the master agree-
ment shall be considered to be a swap agreement 
under this clause only with respect to each agree-
ment or transaction under the master agreement 
that is referred to in subclause (I), (II), (III), or 
(IV); and 
‘‘(VI) any security agreement or arrangement 
or other credit enhancement related to any agree-
ments or transactions referred to in subclause (I), 
(II), (III), (IV), or (V), including any guarantee 
or reimbursement obligation in connection with 
any agreement or transaction referred to in any 
such subclause. 
‘‘(vii) TREATMENT OF MASTER AGREEMENT AS ONE 
AGREEMENT.—Any master agreement for any contract 
or agreement described in any preceding clause of this 
subparagraph (or any master agreement for such 
master agreement or agreements), together with all 
supplements to such master agreement, shall be 
treated as a single agreement and a single qualified 
financial contract. If a master agreement contains 
provisions relating to agreements or transactions that 
are not themselves qualified financial contracts, the 
master agreement shall be deemed to be a qualified 
financial contract only with respect to those trans-
actions that are themselves qualified financial con-
tracts. 
‘‘(viii) TRANSFER.—The term ‘transfer’ means every 
mode, direct or indirect, absolute or conditional, vol-
untary or involuntary, of disposing of or parting with 
property or with an interest in property, including 
retention of title as a security interest and foreclosure 
of the equity of redemption of the regulated entity. 
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122 STAT. 2757 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(E) CERTAIN PROTECTIONS IN EVENT OF APPOINTMENT 
OF CONSERVATOR.—Notwithstanding any other provision of 
this section, any other Federal law, or the law of any 
State (other than paragraph (10) of this subsection and 
subsection (b)(9)(B)), no person shall be stayed or prohibited 
from exercising— 
‘‘(i) any right such person has to cause the termi-
nation, liquidation, or acceleration of any qualified 
financial contract with a regulated entity in a con-
servatorship based upon a default under such financial 
contract which is enforceable under applicable non-
insolvency law; 
‘‘(ii) any right under any security agreement or 
arrangement or other credit enhancement relating to 
1 or more such qualified financial contracts; or 
‘‘(iii) any right to offset or net out any termination 
values, payment amounts, or other transfer obligations 
arising under or in connection with such qualified 
financial contracts. 
‘‘(F) CLARIFICATION.—No provision of law shall be con-
strued as limiting the right or power of the Agency, or 
authorizing any court or agency to limit or delay in any 
manner, the right or power of the Agency to transfer any 
qualified financial contract in accordance with paragraphs 
(9) and (10), or to disaffirm or repudiate any such contract 
in accordance with subsection (d)(1). 
‘‘(G) WALKAWAY CLAUSES NOT EFFECTIVE.— 
‘‘(i) IN GENERAL.—Notwithstanding the provisions 
of subparagraphs (A) and (E), and sections 403 and 
404 of the Federal Deposit Insurance Corporation 
Improvement Act of 1991, no walkaway clause shall 
be enforceable in a qualified financial contract of a 
regulated entity in default. 
‘‘(ii) WALKAWAY
CLAUSE
DEFINED.—For purposes 
of this subparagraph, the term ‘walkaway clause’ 
means a provision in a qualified financial contract 
that, after calculation of a value of a party’s position 
or an amount due to or from 1 of the parties in accord-
ance with its terms upon termination, liquidation, or 
acceleration of the qualified financial contract, either 
does not create a payment obligation of a party or 
extinguishes a payment obligation of a party in whole 
or in part solely because of the status of such party 
as a nondefaulting party. 
‘‘(9) TRANSFER
OF
QUALIFIED
FINANCIAL
CONTRACTS.—In 
making any transfer of assets or liabilities of a regulated entity 
in default which includes any qualified financial contract, the 
conservator or receiver for such regulated entity shall either— 
‘‘(A) transfer to 1 person— 
‘‘(i) all qualified financial contracts between any 
person (or any affiliate of such person) and the regu-
lated entity in default; 
‘‘(ii) all claims of such person (or any affiliate of 
such person) against such regulated entity under any 
such contract (other than any claim which, under the 
terms of any such contract, is subordinated to the 
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122 STAT. 2758 
PUBLIC LAW 110–289—JULY 30, 2008 
claims of general unsecured creditors of such regulated 
entity); 
‘‘(iii) all claims of such regulated entity against 
such person (or any affiliate of such person) under 
any such contract; and 
‘‘(iv) all property securing, or any other credit 
enhancement for any contract described in clause (i), 
or any claim described in clause (ii) or (iii) under 
any such contract; or 
‘‘(B) transfer none of the financial contracts, claims, 
or property referred to under subparagraph (A) (with 
respect to such person and any affiliate of such person). 
‘‘(10) NOTIFICATION OF TRANSFER.— 
‘‘(A) IN GENERAL.—The conservator or receiver shall 
notify any person that is a party to a contract or transfer 
by 5:00 p.m. (Eastern Standard Time) on the business 
day following the date of the appointment of the receiver 
in the case of a receivership, or the business day following 
such transfer in the case of a conservatorship, if— 
‘‘(i) the conservator or receiver for a regulated 
entity in default makes any transfer of the assets 
and liabilities of such regulated entity; and 
‘‘(ii) such transfer includes any qualified financial 
contract. 
‘‘(B) CERTAIN RIGHTS NOT ENFORCEABLE.— 
‘‘(i) RECEIVERSHIP.—A person who is a party to 
a qualified financial contract with a regulated entity 
may not exercise any right that such person has to 
terminate, liquidate, or net such contract under para-
graph (8)(A) of this subsection or under section 403 
or 404 of the Federal Deposit Insurance Corporation 
Improvement Act of 1991, solely by reason of or inci-
dental to the appointment of a receiver for the regu-
lated entity (or the insolvency or financial condition 
of the regulated entity for which the receiver has been 
appointed)— 
‘‘(I) until 5:00 p.m. (Eastern Standard Time) 
on the business day following the date of the 
appointment of the receiver; or 
‘‘(II) after the person has received notice that 
the contract has been transferred pursuant to 
paragraph (9)(A). 
‘‘(ii) CONSERVATORSHIP.—A person who is a party 
to a qualified financial contract with a regulated entity 
may not exercise any right that such person has to 
terminate, liquidate, or net such contract under para-
graph (8)(E) of this subsection or under section 403 
or 404 of the Federal Deposit Insurance Corporation 
Improvement Act of 1991, solely by reason of or inci-
dental to the appointment of a conservator for the 
regulated entity (or the insolvency or financial condi-
tion of the regulated entity for which the conservator 
has been appointed). 
‘‘(iii) NOTICE.—For purposes of this paragraph, the 
conservator or receiver of a regulated entity shall be 
deemed to have notified a person who is a party to 
a qualified financial contract with such regulated 
Effective dates. 
Deadline. 
Contracts. 
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122 STAT. 2759 
PUBLIC LAW 110–289—JULY 30, 2008 
entity, if the conservator or receiver has taken steps 
reasonably calculated to provide notice to such person 
by the time specified in subparagraph (A). 
‘‘(C) BUSINESS
DAY
DEFINED.—For purposes of this 
paragraph, the term ‘business day’ means any day other 
than any Saturday, Sunday, or any day on which either 
the New York Stock Exchange or the Federal Reserve 
Bank of New York is closed. 
‘‘(11) DISAFFIRMANCE OR REPUDIATION OF QUALIFIED FINAN-
CIAL CONTRACTS.—In exercising the rights of disaffirmance or 
repudiation of a conservator or receiver with respect to any 
qualified financial contract to which a regulated entity is a 
party, the conservator or receiver for such institution shall 
either— 
‘‘(A) disaffirm or repudiate all qualified financial con-
tracts between— 
‘‘(i) any person or any affiliate of such person; 
and 
‘‘(ii) the regulated entity in default; or 
‘‘(B) disaffirm or repudiate none of the qualified finan-
cial contracts referred to in subparagraph (A) (with respect 
to such person or any affiliate of such person). 
‘‘(12) CERTAIN
SECURITY
INTERESTS
NOT
AVOIDABLE.—No 
provision of this subsection shall be construed as permitting 
the avoidance of any legally enforceable or perfected security 
interest in any of the assets of any regulated entity, except 
where such an interest is taken in contemplation of the insol-
vency of the regulated entity, or with the intent to hinder, 
delay, or defraud the regulated entity or the creditors of such 
regulated entity. 
‘‘(13) AUTHORITY TO ENFORCE CONTRACTS.— 
‘‘(A) IN GENERAL.—Notwithstanding any provision of 
a contract providing for termination, default, acceleration, 
or exercise of rights upon, or solely by reason of, insolvency 
or the appointment of, or the exercise of rights or powers 
by, a conservator or receiver, the conservator or receiver 
may enforce any contract, other than a contract for liability 
insurance for a director or officer, or a contract or a regu-
lated entity bond, entered into by the regulated entity. 
‘‘(B) CERTAIN RIGHTS NOT AFFECTED.—No provision of 
this paragraph may be construed as impairing or affecting 
any right of the conservator or receiver to enforce or recover 
under a liability insurance contract for an officer or 
director, or regulated entity bond under other applicable 
law. 
‘‘(C) CONSENT REQUIREMENT.— 
‘‘(i) IN
GENERAL.—Except as otherwise provided 
under this section, no person may exercise any right 
or power to terminate, accelerate, or declare a default 
under any contract to which a regulated entity is a 
party, or to obtain possession of or exercise control 
over any property of the regulated entity, or affect 
any contractual rights of the regulated entity, without 
the consent of the conservator or receiver, as appro-
priate, for a period of— 
‘‘(I) 45 days after the date of appointment 
of a conservator; or 
Effective dates. 
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122 STAT. 2760 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(II) 90 days after the date of appointment 
of a receiver. 
‘‘(ii) EXCEPTIONS.—This subparagraph shall not— 
‘‘(I) apply to a contract for liability insurance 
for an officer or director; 
‘‘(II) apply to the rights of parties to certain 
qualified financial contracts under subsection 
(d)(8); and 
‘‘(III) be construed as permitting the conser-
vator or receiver to fail to comply with otherwise 
enforceable provisions of such contracts. 
‘‘(14) SAVINGS CLAUSE.—The meanings of terms used in 
this subsection are applicable for purposes of this subsection 
only, and shall not be construed or applied so as to challenge 
or affect the characterization, definition, or treatment of any 
similar terms under any other statute, regulation, or rule, 
including the Gramm-Leach-Bliley Act, the Legal Certainty 
for Bank Products Act of 2000, the securities laws (as that 
term is defined in section 3(a)(47) of the Securities Exchange 
Act of 1934), and the Commodity Exchange Act. 
‘‘(15) EXCEPTION FOR FEDERAL RESERVE AND FEDERAL HOME 
LOAN BANKS.—No provision of this subsection shall apply with 
respect to— 
‘‘(A) any extension of credit from any Federal Home 
Loan Bank or Federal Reserve Bank to any regulated 
entity; or 
‘‘(B) any security interest in the assets of the regulated 
entity securing any such extension of credit. 
‘‘(e) VALUATION OF CLAIMS IN DEFAULT.— 
‘‘(1) IN GENERAL.—Notwithstanding any other provision of 
Federal law or the law of any State, and regardless of the 
method which the Agency determines to utilize with respect 
to a regulated entity in default or in danger of default, including 
transactions authorized under subsection (i), this subsection 
shall govern the rights of the creditors of such regulated entity. 
‘‘(2) MAXIMUM LIABILITY.—The maximum liability of the 
Agency, acting as receiver or in any other capacity, to any 
person having a claim against the receiver or the regulated 
entity for which such receiver is appointed shall be not more 
than the amount that such claimant would have received if 
the Agency had liquidated the assets and liabilities of the 
regulated entity without exercising the authority of the Agency 
under subsection (i). 
‘‘(f) LIMITATION ON COURT ACTION.—Except as provided in this 
section or at the request of the Director, no court may take any 
action to restrain or affect the exercise of powers or functions 
of the Agency as a conservator or a receiver. 
‘‘(g) LIABILITY OF DIRECTORS AND OFFICERS.— 
‘‘(1) IN GENERAL.—A director or officer of a regulated entity 
may be held personally liable for monetary damages in any 
civil action described in paragraph (2) brought by, on behalf 
of, or at the request or direction of the Agency, and prosecuted 
wholly or partially for the benefit of the Agency— 
‘‘(A) acting as conservator or receiver of such regulated 
entity; or 
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122 STAT. 2761 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) acting based upon a suit, claim, or cause of action 
purchased from, assigned by, or otherwise conveyed by 
such receiver or conservator. 
‘‘(2) ACTIONS ADDRESSED.—Paragraph (1) applies in any 
civil action for gross negligence, including any similar conduct 
or conduct that demonstrates a greater disregard of a duty 
of care than gross negligence, including intentional tortious 
conduct, as such terms are defined and determined under 
applicable State law. 
‘‘(3) NO
LIMITATION.—Nothing in this subsection shall 
impair or affect any right of the Agency under other applicable 
law. 
‘‘(h) DAMAGES.—In any proceeding related to any claim against 
a director, officer, employee, agent, attorney, accountant, appraiser, 
or any other party employed by or providing services to a regulated 
entity, recoverable damages determined to result from the improvi-
dent or otherwise improper use or investment of any assets of 
the regulated entity shall include principal losses and appropriate 
interest. 
‘‘(i) LIMITED-LIFE REGULATED ENTITIES.— 
‘‘(1) ORGANIZATION.— 
‘‘(A) PURPOSE.—The Agency, as receiver appointed 
pursuant to subsection (a)— 
‘‘(i) may, in the case of a Federal Home Loan 
Bank, organize a limited-life regulated entity with 
those powers and attributes of the Federal Home Loan 
Bank in default or in danger of default as the Director 
determines necessary, subject to the provisions of this 
subsection, and the Director shall grant a temporary 
charter to that limited-life regulated entity, and that 
limited-life regulated entity may operate subject to 
that charter; and 
‘‘(ii) shall, in the case of an enterprise, organize 
a limited-life regulated entity with respect to that 
enterprise in accordance with this subsection. 
‘‘(B) AUTHORITIES.—Upon the creation of a limited- 
life regulated entity under subparagraph (A), the limited- 
life regulated entity may— 
‘‘(i) assume such liabilities of the regulated entity 
that is in default or in danger of default as the Agency 
may, in its discretion, determine to be appropriate, 
except that the liabilities assumed shall not exceed 
the amount of assets purchased or transferred from 
the regulated entity to the limited-life regulated entity; 
‘‘(ii) purchase such assets of the regulated entity 
that is in default, or in danger of default as the Agency 
may, in its discretion, determine to be appropriate; 
and 
‘‘(iii) perform any other temporary function which 
the Agency may, in its discretion, prescribe in accord-
ance with this section. 
‘‘(2) CHARTER AND ESTABLISHMENT.— 
‘‘(A) TRANSFER OF CHARTER.— 
‘‘(i) FANNIE MAE.—If the Agency is appointed as 
receiver for the Federal National Mortgage Association, 
the limited-life regulated entity established under this 
subsection with respect to such enterprise shall, by 
Applicability. 
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122 STAT. 2762 
PUBLIC LAW 110–289—JULY 30, 2008 
operation of law and immediately upon its organiza-
tion— 
‘‘(I) succeed to the charter of the Federal 
National Mortgage Association, as set forth in the 
Federal National Mortgage Association Charter 
Act; and 
‘‘(II) thereafter operate in accordance with, and 
subject to, such charter, this Act, and any other 
provision of law to which the Federal National 
Mortgage Association is subject, except as other-
wise provided in this subsection. 
‘‘(ii) FREDDIE MAC.—If the Agency is appointed as 
receiver for the Federal Home Loan Mortgage Corpora-
tion, the limited-life regulated entity established under 
this subsection with respect to such enterprise shall, 
by operation of law and immediately upon its organiza-
tion— 
‘‘(I) succeed to the charter of the Federal Home 
Loan Mortgage Corporation, as set forth in the 
Federal Home Loan Mortgage Corporation Charter 
Act; and 
‘‘(II) thereafter operate in accordance with, and 
subject to, such charter, this Act, and any other 
provision of law to which the Federal Home Loan 
Mortgage Corporation is subject, except as other-
wise provided in this subsection. 
‘‘(B) INTERESTS IN AND ASSETS AND OBLIGATIONS OF 
REGULATED ENTITY IN DEFAULT.—Notwithstanding subpara-
graph (A) or any other provision of law— 
‘‘(i) a limited-life regulated entity shall assume, 
acquire, or succeed to the assets or liabilities of a 
regulated entity only to the extent that such assets 
or liabilities are transferred by the Agency to the lim-
ited-life regulated entity in accordance with, and sub-
ject to the restrictions set forth in, paragraph (1)(B); 
‘‘(ii) a limited-life regulated entity shall not 
assume, acquire, or succeed to any obligation that a 
regulated entity for which a receiver has been 
appointed may have to any shareholder of the regu-
lated entity that arises as a result of the status of 
that person as a shareholder of the regulated entity; 
and 
‘‘(iii) no shareholder or creditor of a regulated 
entity shall have any right or claim against the charter 
of the regulated entity once the Agency has been 
appointed receiver for the regulated entity and a lim-
ited-life regulated entity succeeds to the charter pursu-
ant to subparagraph (A). 
‘‘(C) LIMITED-LIFE
REGULATED
ENTITY
TREATED
AS 
BEING IN DEFAULT FOR CERTAIN PURPOSES.—A limited-life 
regulated entity shall be treated as a regulated entity 
in default at such times and for such purposes as the 
Agency may, in its discretion, determine. 
‘‘(D) MANAGEMENT.—Upon its establishment, a limited- 
life regulated entity shall be under the management of 
a board of directors consisting of not fewer than 5 nor 
more than 10 members appointed by the Agency. 
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122 STAT. 2763 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(E) BYLAWS.—The board of directors of a limited-life 
regulated entity shall adopt such bylaws as may be 
approved by the Agency. 
‘‘(3) CAPITAL STOCK.— 
‘‘(A) NO AGENCY REQUIREMENT.—The Agency is not 
required to pay capital stock into a limited-life regu-
lated entity or to issue any capital stock on behalf 
of a limited-life regulated entity established under this 
subsection. 
‘‘(B) AUTHORITY.—If the Director determines that 
such action is advisable, the Agency may cause capital 
stock or other securities of a limited-life regulated 
entity established with respect to an enterprise to be 
issued and offered for sale, in such amounts and on 
such terms and conditions as the Director may deter-
mine, in the discretion of the Director. 
‘‘(4) INVESTMENTS.—Funds of a limited-life regulated entity 
shall be kept on hand in cash, invested in obligations of the 
United States or obligations guaranteed as to principal and 
interest by the United States, or deposited with the Agency, 
or any Federal reserve bank. 
‘‘(5) EXEMPT
TAX
STATUS.—Notwithstanding any other 
provision of Federal or State law, a limited-life regulated entity, 
its franchise, property, and income shall be exempt from all 
taxation now or hereafter imposed by the United States, by 
any territory, dependency, or possession thereof, or by any 
State, county, municipality, or local taxing authority. 
‘‘(6) WINDING UP.— 
‘‘(A) IN GENERAL.—Subject to subparagraphs (B) and 
(C), not later than 2 years after the date of its organization, 
the Agency shall wind up the affairs of a limited-life regu-
lated entity. 
‘‘(B) EXTENSION.—The Director may, in the discretion 
of the Director, extend the status of a limited-life regulated 
entity for 3 additional 1-year periods. 
‘‘(C) TERMINATION OF STATUS AS LIMITED-LIFE REGU-
LATED ENTITY.— 
‘‘(i) IN GENERAL.—Upon the sale by the Agency 
of 80 percent or more of the capital stock of a limited- 
life regulated entity, as defined in clause (iv), to 1 
or more persons (other than the Agency)— 
‘‘(I) the status of the limited-life regulated 
entity as such shall terminate; and 
‘‘(II) the entity shall cease to be a limited- 
life regulated entity for purposes of this subsection. 
‘‘(ii) DIVESTITURE OF REMAINING STOCK, IF ANY.— 
‘‘(I) IN GENERAL.—Not later than 1 year after 
the date on which the status of a limited-life regu-
lated entity is terminated pursuant to clause (i), 
the Agency shall sell to 1 or more persons (other 
than the Agency) any remaining capital stock of 
the former limited-life regulated entity. 
‘‘(II) EXTENSION
AUTHORIZED.—The Director 
may extend the period referred to in subclause 
(I) for not longer than an additional 2 years, if 
the Director determines that such action would 
be in the public interest. 
Deadline. 
Deadline. 
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122 STAT. 2764 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iii) 
SAVINGS
CLAUSE.—Notwithstanding 
any 
provision of law, other than clause (ii), the Agency 
shall not be required to sell the capital stock of an 
enterprise or a limited-life regulated entity established 
with respect to an enterprise. 
‘‘(iv) APPLICABILITY.—This subparagraph applies 
only with respect to a limited-life regulated entity that 
is established with respect to an enterprise. 
‘‘(7) TRANSFER OF ASSETS AND LIABILITIES.— 
‘‘(A) IN GENERAL.— 
‘‘(i) TRANSFER
OF
ASSETS
AND
LIABILITIES.—The 
Agency, as receiver, may transfer any assets and liabil-
ities of a regulated entity in default, or in danger 
of default, to the limited-life regulated entity in accord-
ance with and subject to the restrictions of paragraph 
(1). 
‘‘(ii) SUBSEQUENT TRANSFERS.—At any time after 
the establishment of a limited-life regulated entity, 
the Agency, as receiver, may transfer any assets and 
liabilities of the regulated entity in default, or in 
danger of default, as the Agency may, in its discretion, 
determine to be appropriate in accordance with and 
subject to the restrictions of paragraph (1). 
‘‘(iii) EFFECTIVE WITHOUT APPROVAL.—The transfer 
of any assets or liabilities of a regulated entity in 
default or in danger of default to a limited-life regu-
lated entity shall be effective without any further 
approval under Federal or State law, assignment, or 
consent with respect thereto. 
‘‘(iv) EQUITABLE
TREATMENT
OF
SIMILARLY
SITU-
ATED CREDITORS.—The Agency shall treat all creditors 
of a regulated entity in default or in danger of default 
that are similarly situated under subsection (c)(1) in 
a similar manner in exercising the authority of the 
Agency under this subsection to transfer any assets 
or liabilities of the regulated entity to the limited- 
life regulated entity established with respect to such 
regulated entity, except that the Agency may take 
actions (including making payments) that do not 
comply with this clause, if— 
‘‘(I) the Director determines that such actions 
are necessary to maximize the value of the assets 
of the regulated entity, to maximize the present 
value return from the sale or other disposition 
of the assets of the regulated entity, or to minimize 
the amount of any loss realized upon the sale 
or other disposition of the assets of the regulated 
entity; and 
‘‘(II) all creditors that are similarly situated 
under subsection (c)(1) receive not less than the 
amount provided in subsection (e)(2). 
‘‘(v) LIMITATION ON TRANSFER OF LIABILITIES.—Not-
withstanding any other provision of law, the aggregate 
amount of liabilities of a regulated entity that are 
transferred to, or assumed by, a limited-life regulated 
entity may not exceed the aggregate amount of assets 
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122 STAT. 2765 
PUBLIC LAW 110–289—JULY 30, 2008 
of the regulated entity that are transferred to, or pur-
chased by, the limited-life regulated entity. 
‘‘(8) REGULATIONS.—The Agency may promulgate such 
regulations as the Agency determines to be necessary or appro-
priate to implement this subsection. 
‘‘(9) POWERS OF LIMITED-LIFE REGULATED ENTITIES.— 
‘‘(A) IN GENERAL.—Each limited-life regulated entity 
created under this subsection shall have all corporate 
powers of, and be subject to the same provisions of law 
as, the regulated entity in default or in danger of default 
to which it relates, except that— 
‘‘(i) the Agency may— 
‘‘(I) remove the directors of a limited-life regu-
lated entity; 
‘‘(II) fix the compensation of members of the 
board of directors and senior management, as 
determined by the Agency in its discretion, of a 
limited-life regulated entity; and 
‘‘(III) indemnify the representatives for pur-
poses of paragraph (1)(B), and the directors, offi-
cers, employees, and agents of a limited-life regu-
lated entity on such terms as the Agency deter-
mines to be appropriate; and 
‘‘(ii) the board of directors of a limited-life regu-
lated entity— 
‘‘(I) shall elect a chairperson who may also 
serve in the position of chief executive officer, 
except that such person shall not serve either as 
chairperson or as chief executive officer without 
the prior approval of the Agency; and 
‘‘(II) may appoint a chief executive officer who 
is not also the chairperson, except that such person 
shall not serve as chief executive officer without 
the prior approval of the Agency. 
‘‘(B) STAY
OF
JUDICIAL
ACTION.—Any judicial action 
to which a limited-life regulated entity becomes a party 
by virtue of its acquisition of any assets or assumption 
of any liabilities of a regulated entity in default shall 
be stayed from further proceedings for a period of not 
longer than 45 days, at the request of the limited-life 
regulated entity. Such period may be modified upon the 
consent of all parties. 
‘‘(10) NO FEDERAL STATUS.— 
‘‘(A) AGENCY STATUS.—A limited-life regulated entity 
is not an agency, establishment, or instrumentality of the 
United States. 
‘‘(B) EMPLOYEE STATUS.—Representatives for purposes 
of paragraph (1)(B), interim directors, directors, officers, 
employees, or agents of a limited-life regulated entity are 
not, solely by virtue of service in any such capacity, officers 
or employees of the United States. Any employee of the 
Agency or of any Federal instrumentality who serves at 
the request of the Agency as a representative for purposes 
of paragraph (1)(B), interim director, director, officer, 
employee, or agent of a limited-life regulated entity shall 
not— 
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122 STAT. 2766 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) solely by virtue of service in any such capacity 
lose any existing status as an officer or employee of 
the United States for purposes of title 5, United States 
Code, or any other provision of law; or 
‘‘(ii) receive any salary or benefits for service in 
any such capacity with respect to a limited-life regu-
lated entity in addition to such salary or benefits as 
are obtained through employment with the Agency 
or such Federal instrumentality. 
‘‘(11) AUTHORITY TO OBTAIN CREDIT.— 
‘‘(A) IN GENERAL.—A limited-life regulated entity may 
obtain unsecured credit and issue unsecured debt. 
‘‘(B) INABILITY
TO
OBTAIN
CREDIT.—If a limited-life 
regulated entity is unable to obtain unsecured credit or 
issue unsecured debt, the Director may authorize the 
obtaining of credit or the issuance of debt by the limited- 
life regulated entity— 
‘‘(i) with priority over any or all of the obligations 
of the limited-life regulated entity; 
‘‘(ii) secured by a lien on property of the limited- 
life regulated entity that is not otherwise subject to 
a lien; or 
‘‘(iii) secured by a junior lien on property of the 
limited-life regulated entity that is subject to a lien. 
‘‘(C) LIMITATIONS.— 
‘‘(i) IN GENERAL.—The Director, after notice and 
a hearing, may authorize the obtaining of credit or 
the issuance of debt by a limited-life regulated entity 
that is secured by a senior or equal lien on property 
of the limited-life regulated entity that is subject to 
a lien (other than mortgages that collateralize the 
mortgage-backed securities issued or guaranteed by 
an enterprise) only if— 
‘‘(I) the limited-life regulated entity is unable 
to otherwise obtain such credit or issue such debt; 
and 
‘‘(II) there is adequate protection of the 
interest of the holder of the lien on the property 
with respect to which such senior or equal lien 
is proposed to be granted. 
‘‘(D) BURDEN OF PROOF.—In any hearing under this 
subsection, the Director has the burden of proof on the 
issue of adequate protection. 
‘‘(12) EFFECT ON DEBTS AND LIENS.—The reversal or modi-
fication on appeal of an authorization under this subsection 
to obtain credit or issue debt, or of a grant under this section 
of a priority or a lien, does not affect the validity of any 
debt so issued, or any priority or lien so granted, to an entity 
that extended such credit in good faith, whether or not such 
entity knew of the pendency of the appeal, unless such 
authorization and the issuance of such debt, or the granting 
of such priority or lien, were stayed pending appeal. 
‘‘(j) OTHER AGENCY EXEMPTIONS.— 
‘‘(1) APPLICABILITY.—The provisions of this subsection shall 
apply with respect to the Agency in any case in which the 
Agency is acting as a conservator or a receiver. 
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122 STAT. 2767 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) TAXATION.—The Agency, including its franchise, its 
capital, reserves, and surplus, and its income, shall be exempt 
from all taxation imposed by any State, county, municipality, 
or local taxing authority, except that any real property of the 
Agency shall be subject to State, territorial, county, municipal, 
or local taxation to the same extent according to its value 
as other real property is taxed, except that, notwithstanding 
the failure of any person to challenge an assessment under 
State law of the value of such property, and the tax thereon, 
shall be determined as of the period for which such tax is 
imposed. 
‘‘(3) PROPERTY PROTECTION.—No property of the Agency 
shall be subject to levy, attachment, garnishment, foreclosure, 
or sale without the consent of the Agency, nor shall any involun-
tary lien attach to the property of the Agency. 
‘‘(4) PENALTIES AND FINES.—The Agency shall not be liable 
for any amounts in the nature of penalties or fines, including 
those arising from the failure of any person to pay any real 
property, personal property, probate, or recording tax or any 
recording or filing fees when due. 
‘‘(k) PROHIBITION OF CHARTER REVOCATION.—In no case may 
the receiver appointed pursuant to this section revoke, annul, or 
terminate the charter of an enterprise.’’. 
(b) TECHNICAL AND CONFORMING AMENDMENTS.—The Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4501 et seq.) is amended— 
(1) in section 1368 (12 U.S.C. 4618)— 
(A) by striking ‘‘an enterprise’’ each place that term 
appears and inserting ‘‘a regulated entity’’; and 
(B) by striking ‘‘the enterprise’’ each place that term 
appears and inserting ‘‘the regulated entity’’; 
(2) in section 1369C (12 U.S.C. 4622), by striking ‘‘enter-
prise’’ each place that term appears and inserting ‘‘regulated 
entity’’; 
(3) in section 1369D (12 U.S.C. 4623)— 
(A) by striking ‘‘an enterprise’’ each place that term 
appears and inserting ‘‘a regulated entity’’; and 
(B) in subsection (a)(1), by striking ‘‘An enterprise’’ 
and inserting ‘‘A regulated entity’’; and 
(4) by striking sections 1369, 1369A, and 1369B (12 U.S.C. 
4619, 4620, and 4621). 
Subtitle D—Enforcement Actions 
SEC. 1151. CEASE AND DESIST PROCEEDINGS. 
Section 1371 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4631) is amended— 
(1) by striking subsections (a) and (b) and inserting the 
following: 
‘‘(a) ISSUANCE FOR UNSAFE OR UNSOUND PRACTICES AND VIOLA-
TIONS.— 
‘‘(1) AUTHORITY OF DIRECTOR.—If, in the opinion of the 
Director, a regulated entity or any entity-affiliated party is 
engaging or has engaged, or the Director has reasonable cause 
to believe that the regulated entity or any entity-affiliated 
party is about to engage, in an unsafe or unsound practice 
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122 STAT. 2768 
PUBLIC LAW 110–289—JULY 30, 2008 
in conducting the business of the regulated entity or the Office 
of Finance, or is violating or has violated, or the Director 
has reasonable cause to believe is about to violate, a law, 
rule, regulation, or order, or any condition imposed in writing 
by the Director in connection with the granting of any applica-
tion or other request by the regulated entity or the Office 
of Finance or any written agreement entered into with the 
Director, the Director may issue and serve upon the regulated 
entity or entity-affiliated party a notice of charges in respect 
thereof. 
‘‘(2) LIMITATION.—The Director may not, pursuant to this 
section, enforce compliance with any housing goal established 
under subpart B of part 2 of subtitle A of this title, with 
section 1336 or 1337 of this title, with subsection (m) or (n) 
of section 309 of the Federal National Mortgage Association 
Charter Act (12 U.S.C. 1723a(m), (n)), with subsection (e) or 
(f) of section 307 of the Federal Home Loan Mortgage Corpora-
tion Act (12 U.S.C. 1456(e), (f)), or with paragraph (5) of section 
10(j) of the Federal Home Loan Bank Act (12 U.S.C. 1430(j)). 
‘‘(b) ISSUANCE FOR UNSATISFACTORY RATING.—If a regulated 
entity receives, in its most recent report of examination, a less- 
than-satisfactory rating for asset quality, management, earnings, 
or liquidity, the Director may (if the deficiency is not corrected) 
deem the regulated entity to be engaging in an unsafe or unsound 
practice for purposes of subsection (a).’’; 
(2) in subsection (c)— 
(A) in paragraph (1), by inserting before the period 
at the end the following: ‘‘, unless the party served with 
a notice of charges shall appear at the hearing personally 
or by a duly authorized representative, the party shall 
be deemed to have consented to the issuance of the cease 
and desist order’’; and 
(B) in paragraph (2)— 
(i) by striking ‘‘or director’’ and inserting ‘‘director, 
or entity-affiliated party’’; and 
(ii) by inserting ‘‘or entity-affiliated party’’ before 
‘‘consents’’; 
(3) in each of subsections (c), (d), and (e)— 
(A) by striking ‘‘the enterprise’’ each place that term 
appears and inserting ‘‘the regulated entity’’; 
(B) by striking ‘‘an enterprise’’ each place that term 
appears and inserting ‘‘a regulated entity’’; and 
(C) by striking ‘‘conduct’’ each place that term appears 
and inserting ‘‘practice’’; 
(4) in subsection (d)— 
(A) in the matter preceding paragraph (1)— 
(i) by striking ‘‘or director’’ and inserting ‘‘director, 
or entity-affiliated party’’; and 
(ii) by inserting ‘‘to require a regulated entity or 
entity-affiliated party’’ after ‘‘includes the authority’’; 
(B) in paragraph (1)— 
(i) by striking ‘‘to require an executive officer or 
a director to’’; and 
(ii) by striking ‘‘loss’’ and all that follows through 
‘‘person’’ and inserting ‘‘loss, if’’; 
(iii) in subparagraph (A), by inserting ‘‘such entity 
or party or finance facility’’ before ‘‘was’’; and 
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122 STAT. 2769 
PUBLIC LAW 110–289—JULY 30, 2008 
(iv) by striking subparagraph (B) and inserting 
the following: 
‘‘(B) the violation or practice involved a reckless dis-
regard for the law or any applicable regulations or prior 
order of the Director;’’; and 
(C) in paragraph (4), by inserting ‘‘loan or’’ before 
‘‘asset’’; 
(5) in subsection (e), by inserting ‘‘or entity-affiliated 
party’’— 
(A) before ‘‘or any executive’’; and 
(B) before the period at the end; and 
(6) in subsection (f)— 
(A) by striking ‘‘enterprise’’ and inserting ‘‘regulated 
entity, finance facility,’’; and 
(B) by striking ‘‘or director’’ and inserting ‘‘director, 
or entity-affiliated party’’. 
SEC. 1152. TEMPORARY CEASE AND DESIST PROCEEDINGS. 
Section 1372 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4632) is amended— 
(1) by striking subsection (a) and inserting the following: 
‘‘(a) GROUNDS FOR ISSUANCE.— 
‘‘(1) IN
GENERAL.—If the Director determines that the 
actions specified in the notice of charges served upon a regu-
lated entity or any entity-affiliated party pursuant to section 
1371(a), or the continuation thereof, is likely to cause insolvency 
or significant dissipation of assets or earnings of that entity, 
or is likely to weaken the condition of that entity prior to 
the completion of the proceedings conducted pursuant to sec-
tions 1371 and 1373, the Director may— 
‘‘(A) issue a temporary order requiring that regulated 
entity or entity-affiliated party to cease and desist from 
any such violation or practice; and 
‘‘(B) require that regulated entity or entity-affiliated 
party to take affirmative action to prevent or remedy such 
insolvency, dissipation, condition, or prejudice pending 
completion of such proceedings. 
‘‘(2) ADDITIONAL REQUIREMENTS.—An order issued under 
paragraph (1) may include any requirement authorized under 
subsection 1371(d).’’; 
(2) in subsection (b)— 
(A) by striking ‘‘or director’’ and inserting ‘‘director, 
or entity-affiliated party’’; and 
(B) by striking ‘‘enterprise’’ each place that term 
appears and inserting ‘‘regulated entity’’; 
(3) in subsection (c), by striking ‘‘enterprise’’ each place 
that term appears and inserting ‘‘regulated entity’’; 
(4) in subsection (d)— 
(A) by striking ‘‘or director’’ each place that term 
appears and inserting ‘‘director, or entity-affiliated party’’; 
and 
(B) by striking ‘‘An enterprise’’ and inserting ‘‘A regu-
lated entity’’; and 
(5) in subsection (e)— 
(A) by striking ‘‘request the Attorney General of the 
United States to’’; and 
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122 STAT. 2770 
PUBLIC LAW 110–289—JULY 30, 2008 
(B) by striking ‘‘or may, under the direction and control 
of the Attorney General, bring such action’’. 
SEC. 1153. REMOVAL AND PROHIBITION AUTHORITY. 
(a) IN GENERAL.—Part 1 of subtitle C of the Federal Housing 
Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 
4631 et seq.) is amended— 
(1) by redesignating sections 1377 through 1379B (12 
U.S.C. 4637–4641) as sections 1379 through 1379D, respec-
tively; and 
(2) by inserting after section 1376 (12 U.S.C. 4636) the 
following: 
‘‘SEC. 1377. REMOVAL AND PROHIBITION AUTHORITY. 
‘‘(a) AUTHORITY TO ISSUE ORDER.— 
‘‘(1) IN GENERAL.—The Director may serve upon a party 
described in paragraph (2), or any officer, director, or manage-
ment of the Office of Finance a written notice of the intention 
of the Director to suspend or remove such party from office, 
or prohibit any further participation by such party, in any 
manner, in the conduct of the affairs of the regulated entity. 
‘‘(2) APPLICABILITY.—A party described in this paragraph 
is an entity-affiliated party or any officer, director, or manage-
ment of the Office of Finance, if the Director determines that— 
‘‘(A) that party, officer, or director has, directly or 
indirectly— 
‘‘(i) violated— 
‘‘(I) any law or regulation; 
‘‘(II) any cease and desist order which has 
become final; 
‘‘(III) any condition imposed in writing by the 
Director in connection with the grant of any 
application or other request by such regulated 
entity; or 
‘‘(IV) any written agreement between such 
regulated entity and the Director; 
‘‘(ii) engaged or participated in any unsafe or 
unsound practice in connection with any regulated 
entity or business institution; or 
‘‘(iii) committed or engaged in any act, omission, 
or practice which constitutes a breach of such party’s 
fiduciary duty; 
‘‘(B) by reason of the violation, practice, or breach 
described in subparagraph (A)— 
‘‘(i) such regulated entity or business institution 
has suffered or will probably suffer financial loss or 
other damage; or 
‘‘(ii) such party has received financial gain or other 
benefit; and 
‘‘(C) the violation, practice, or breach described in 
subparagraph (A)— 
‘‘(i) involves personal dishonesty on the part of 
such party; or 
‘‘(ii) demonstrates willful or continuing disregard 
by such party for the safety or soundness of such 
regulated entity or business institution. 
‘‘(b) SUSPENSION ORDER.— 
12 USC 4636a. 
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122 STAT. 2771 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) SUSPENSION
OR
PROHIBITION
AUTHORITY.—If the 
Director serves written notice under subsection (a) upon a 
party subject to that subsection (a), the Director may, by order, 
suspend or remove such party from office, or prohibit such 
party from further participation in any manner in the conduct 
of the affairs of the regulated entity, if the Director— 
‘‘(A) determines that such action is necessary for the 
protection of the regulated entity; and 
‘‘(B) serves such party with written notice of the order. 
‘‘(2) EFFECTIVE PERIOD.—Any order issued under this sub-
section— 
‘‘(A) shall become effective upon service; and 
‘‘(B) unless a court issues a stay of such order under 
subsection (g), shall remain in effect and enforceable until— 
‘‘(i) the date on which the Director dismisses the 
charges contained in the notice served under subsection 
(a) with respect to such party; or 
‘‘(ii) the effective date of an order issued under 
subsection (b). 
‘‘(3) COPY OF ORDER.—If the Director issues an order under 
subsection (b) to any party, the Director shall serve a copy 
of such order on any regulated entity with which such party 
is affiliated at the time such order is issued. 
‘‘(c) NOTICE, HEARING, AND ORDER.— 
‘‘(1) NOTICE.—A notice under subsection (a) of the intention 
of the Director to issue an order under this section shall contain 
a statement of the facts constituting grounds for such action, 
and shall fix a time and place at which a hearing will be 
held on such action. 
‘‘(2) TIMING
OF
HEARING.—A hearing shall be fixed for 
a date not earlier than 30 days, nor later than 60 days, after 
the date of service of notice under subsection (a), unless an 
earlier or a later date is set by the Director at the request 
of— 
‘‘(A) the party receiving such notice, and good cause 
is shown; or 
‘‘(B) the Attorney General of the United States. 
‘‘(3) CONSENT.—Unless the party that is the subject of 
a notice delivered under subsection (a) appears at the hearing 
in person or by a duly authorized representative, such party 
shall be deemed to have consented to the issuance of an order 
under this section. 
‘‘(4) ISSUANCE OF ORDER OF SUSPENSION.—The Director may 
issue an order under this section, as the Director may deem 
appropriate, if— 
‘‘(A) a party is deemed to have consented to the 
issuance of an order under paragraph (3); or 
‘‘(B) upon the record made at the hearing, the Director 
finds that any of the grounds specified in the notice have 
been established. 
‘‘(5) EFFECTIVENESS OF ORDER.—Any order issued under 
paragraph (4) shall become effective at the expiration of 30 
days after the date of service upon the relevant regulated 
entity and party (except in the case of an order issued upon 
consent under paragraph (3), which shall become effective at 
the time specified therein). Such order shall remain effective 
and enforceable except to such extent as it is stayed, modified, 
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122 STAT. 2772 
PUBLIC LAW 110–289—JULY 30, 2008 
terminated, or set aside by action of the Director or a reviewing 
court. 
‘‘(d) PROHIBITION OF CERTAIN SPECIFIC ACTIVITIES.—Any person 
subject to an order issued under this section shall not— 
‘‘(1) participate in any manner in the conduct of the affairs 
of any regulated entity or the Office of Finance; 
‘‘(2) solicit, procure, transfer, attempt to transfer, vote, 
or attempt to vote any proxy, consent, or authorization with 
respect to any voting rights in any regulated entity; 
‘‘(3) violate any voting agreement previously approved by 
the Director; or 
‘‘(4) vote for a director, or serve or act as an entity-affiliated 
party of a regulated entity or as an officer or director of the 
Office of Finance. 
‘‘(e) INDUSTRY-WIDE PROHIBITION.— 
‘‘(1) IN GENERAL.—Except as provided in paragraph (2), 
any person who, pursuant to an order issued under this section, 
has been removed or suspended from office in a regulated 
entity or the Office of Finance, or prohibited from participating 
in the conduct of the affairs of a regulated entity or the Office 
of Finance, may not, while such order is in effect, continue 
or commence to hold any office in, or participate in any manner 
in the conduct of the affairs of, any regulated entity or the 
Office of Finance. 
‘‘(2) EXCEPTION IF DIRECTOR PROVIDES WRITTEN CONSENT.— 
If, on or after the date on which an order is issued under 
this section which removes or suspends from office any party, 
or prohibits such party from participating in the conduct of 
the affairs of a regulated entity or the Office of Finance, such 
party receives the written consent of the Director, the order 
shall, to the extent of such consent, cease to apply to such 
party with respect to the regulated entity or such Office of 
Finance described in the written consent. Any such consent 
shall be publicly disclosed. 
‘‘(3) VIOLATION OF PARAGRAPH (1) TREATED AS VIOLATION 
OF ORDER.—Any violation of paragraph (1) by any person who 
is subject to an order issued under subsection (h) shall be 
treated as a violation of the order. 
‘‘(f) APPLICABILITY.—This section shall only apply to a person 
who is an individual, unless the Director specifically finds that 
it should apply to a corporation, firm, or other business entity. 
‘‘(g) STAY OF SUSPENSION AND PROHIBITION OF ENTITY-AFFILI-
ATED PARTY.—Not later than 10 days after the date on which 
any entity-affiliated party has been suspended from office or prohib-
ited from participation in the conduct of the affairs of a regulated 
entity under this section, such party may apply to the United 
States District Court for the District of Columbia, or the United 
States district court for the judicial district in which the head-
quarters of the regulated entity is located, for a stay of such suspen-
sion or prohibition pending the completion of the administrative 
proceedings pursuant to subsection (c). The court shall have jurisdic-
tion to stay such suspension or prohibition. 
‘‘(h) SUSPENSION
OR REMOVAL
OF ENTITY-AFFILIATED PARTY 
CHARGED WITH FELONY.— 
‘‘(1) SUSPENSION OR PROHIBITION.— 
‘‘(A) IN GENERAL.—Whenever any entity-affiliated party 
is charged in any information, indictment, or complaint, 
Deadline. 
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122 STAT. 2773 
PUBLIC LAW 110–289—JULY 30, 2008 
with the commission of or participation in a crime involving 
dishonesty or breach of trust which is punishable by impris-
onment for a term exceeding 1 year under Federal or 
State law, the Director may, if continued service or partici-
pation by such party may pose a threat to the regulated 
entity or impair public confidence in the regulated entity, 
by written notice served upon such party, suspend such 
party from office or prohibit such party from further partici-
pation in any manner in the conduct of the affairs of 
any regulated entity. 
‘‘(B) PROVISIONS APPLICABLE TO NOTICE.— 
‘‘(i) COPY.—A copy of any notice under subpara-
graph (A) shall be served upon the relevant regulated 
entity. 
‘‘(ii) EFFECTIVE PERIOD.—A suspension or prohibi-
tion under subparagraph (A) shall remain in effect 
until the information, indictment, or complaint referred 
to in subparagraph (A) is finally disposed of, or until 
terminated by the Director. 
‘‘(2) REMOVAL OR PROHIBITION.— 
‘‘(A) IN GENERAL.—If a judgment of conviction or an 
agreement to enter a pretrial diversion or other similar 
program is entered against an entity-affiliated party in 
connection with a crime described in paragraph (1)(A), 
at such time as such judgment is not subject to further 
appellate review, the Director may, if continued service 
or participation by such party may pose a threat to the 
regulated entity or impair public confidence in the regu-
lated entity, issue and serve upon such party an order 
removing such party from office or prohibiting such party 
from further participation in any manner in the conduct 
of the affairs of the regulated entity without the prior 
written consent of the Director. 
‘‘(B) PROVISIONS APPLICABLE TO ORDER.— 
‘‘(i) COPY.—A copy of any order under subpara-
graph (A) shall be served upon the relevant regulated 
entity, at which time the entity-affiliated party who 
is subject to the order (if a director or an officer) 
shall cease to be a director or officer of such regulated 
entity. 
‘‘(ii) EFFECT OF ACQUITTAL.—A finding of not guilty 
or other disposition of the charge shall not preclude 
the Director from instituting proceedings after such 
finding or disposition to remove a party from office 
or to prohibit further participation in the affairs of 
a regulated entity pursuant to subsection (a) or (b). 
‘‘(iii) EFFECTIVE
PERIOD.—Unless terminated by 
the Director, any notice of suspension or order of 
removal issued under this subsection shall remain 
effective and outstanding until the completion of any 
hearing or appeal authorized under paragraph (4). 
‘‘(3) AUTHORITY OF REMAINING BOARD MEMBERS.— 
‘‘(A) IN
GENERAL.—If at any time, because of the 
suspension of 1 or more directors pursuant to this section, 
there shall be on the board of directors of a regulated 
entity less than a quorum of directors not so suspended, 
all powers and functions vested in or exercisable by such 
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122 STAT. 2774 
PUBLIC LAW 110–289—JULY 30, 2008 
board shall vest in and be exercisable by the director or 
directors on the board not so suspended, until such time 
as there shall be a quorum of the board of directors. 
‘‘(B) APPOINTMENT OF TEMPORARY DIRECTORS.—If all 
of the directors of a regulated entity are suspended pursu-
ant to this section, the Director shall appoint persons to 
serve temporarily as directors pending the termination of 
such suspensions, or until such time as those who have 
been suspended cease to be directors of the regulated entity 
and their respective successors take office. 
‘‘(4) HEARING REGARDING CONTINUED PARTICIPATION.— 
‘‘(A) IN GENERAL.—Not later than 30 days after the 
date of service of any notice of suspension or order of 
removal issued pursuant to paragraph (1) or (2), the entity- 
affiliated party may request in writing an opportunity to 
appear before the Director to show that the continued 
service or participation in the conduct of the affairs of 
the regulated entity by such party does not, or is not 
likely to, pose a threat to the interests of the regulated 
entity, or threaten to impair public confidence in the regu-
lated entity. 
‘‘(B) TIMING AND FORM OF HEARING.—Upon receipt of 
a request for a hearing under subparagraph (A), the 
Director shall fix a time (not later than 30 days after 
the date of receipt of such request, unless extended at 
the request of such party) and place at which the entity- 
affiliated party may appear, personally or through counsel, 
before the Director or 1 or more designated employees 
of the Director to submit written materials (or, at the 
discretion of the Director, oral testimony) and oral argu-
ment. 
‘‘(C) DETERMINATION.—Not later than 60 days after 
the date of a hearing under subparagraph (B), the Director 
shall notify the entity-affiliated party whether the suspen-
sion or prohibition from participation in any manner in 
the conduct of the affairs of the regulated entity will be 
continued, terminated, or otherwise modified, or whether 
the order removing such party from office or prohibiting 
such party from further participation in any manner in 
the conduct of the affairs of the regulated entity will be 
rescinded or otherwise modified. Such notification shall 
contain a statement of the basis for any adverse decision 
of the Director. 
‘‘(5) RULES.—The Director is authorized to prescribe such 
rules as may be necessary to carry out this subsection.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) SAFETY AND SOUNDNESS ACT.—Subtitle C of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 
1992 (12 U.S.C. 4501 et seq.) is amended— 
(A) in section 1317(f), by striking ‘‘section 1379B’’ and 
inserting ‘‘section 1379D’’; 
(B) in section 1373(a)— 
(i) in paragraph (1), by striking ‘‘or 1376(c)’’ and 
inserting ‘‘, 1376(c), or 1377’’; 
(ii) in paragraph (2), by inserting ‘‘or 1377’’ after’’ 
1371’’; and 
12 USC 4633. 
12 USC 4517. 
Deadline. 
Notification. 
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122 STAT. 2775 
PUBLIC LAW 110–289—JULY 30, 2008 
(iii) in paragraph (4), by inserting ‘‘or removal 
or prohibition’’ after ‘‘cease and desist’’; and 
(C) in section 1374(a)— 
(i) by striking ‘‘or 1376’’ and inserting ‘‘1313B, 
1376, or 1377’’; and 
(ii) by striking ‘‘such section’’ and inserting ‘‘this 
title’’. 
(2) FANNIE MAE CHARTER ACT.—Section 308(b) of the Fed-
eral National Mortgage Association Charter Act (12 U.S.C. 
1723(b)) is amended in the second sentence, by striking ‘‘The’’ 
and inserting ‘‘Except to the extent that action under section 
1377 of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 temporarily results in a lesser number, 
the’’. 
(3) FREDDIE
MAC
CHARTER
ACT.—Section 303(a)(2)(A) of 
the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
1452(a)(2)(A)) is amended, in the second sentence, by striking 
‘‘The’’ and inserting ‘‘Except to the extent action under section 
1377 of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 temporarily results in a lesser number, 
the’’. 
SEC. 1154. ENFORCEMENT AND JURISDICTION. 
Section 1375 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4635) is amended— 
(1) by striking subsection (a) and inserting the following 
new subsection: 
‘‘(a) ENFORCEMENT.—The Director may, in the discretion of 
the Director, apply to the United States District Court for the 
District of Columbia, or the United States district court within 
the jurisdiction of which the headquarters of the regulated entity 
is located, for the enforcement of any effective and outstanding 
notice or order issued under this subtitle or subtitle B, or request 
that the Attorney General of the United States bring such an 
action. Such court shall have jurisdiction and power to order and 
require compliance with such notice or order.’’; and 
(2) in subsection (b), by striking ‘‘or 1376’’ and inserting 
‘‘1313B, 1376, or 1377’’. 
SEC. 1155. CIVIL MONEY PENALTIES. 
Section 1376 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4636) is amended— 
(1) by striking subsection (a) and inserting the following: 
‘‘(a) IN GENERAL.—The Director may impose a civil money 
penalty in accordance with this section on any regulated entity 
or any entity-affiliated party. The Director shall not impose a civil 
penalty in accordance with this section on any regulated entity 
or any entity-affiliated party for any violation that is addressed 
under section 1345(a).’’; 
(2) by striking subsection (b) and inserting the following: 
‘‘(b) AMOUNT OF PENALTY.— 
‘‘(1) FIRST
TIER.—A regulated entity or entity-affiliated 
party shall forfeit and pay a civil penalty of not more than 
$10,000 for each day during which a violation continues, if 
such regulated entity or party— 
‘‘(A) violates any provision of this title, the authorizing 
statutes, or any order, condition, rule, or regulation under 
this title or any authorizing statute; 
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122 STAT. 2776 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) violates any final or temporary order or notice 
issued pursuant to this title; 
‘‘(C) violates any condition imposed in writing by the 
Director in connection with the grant of any application 
or other request by such regulated entity; or 
‘‘(D) violates any written agreement between the regu-
lated entity and the Director. 
‘‘(2) SECOND TIER.—Notwithstanding paragraph (1), a regu-
lated entity or entity-affiliated party shall forfeit and pay a 
civil penalty of not more than $50,000 for each day during 
which a violation, practice, or breach continues, if— 
‘‘(A) the regulated entity or entity-affiliated party, 
respectively— 
‘‘(i) commits any violation described in any 
subparagraph of paragraph (1); 
‘‘(ii) recklessly engages in an unsafe or unsound 
practice in conducting the affairs of the regulated 
entity; or 
‘‘(iii) breaches any fiduciary duty; and 
‘‘(B) the violation, practice, or breach— 
‘‘(i) is part of a pattern of misconduct; 
‘‘(ii) causes or is likely to cause more than a 
minimal loss to the regulated entity; or 
‘‘(iii) results in pecuniary gain or other benefit 
to such party. 
‘‘(3) THIRD TIER.—Notwithstanding paragraphs (1) and (2), 
any regulated entity or entity-affiliated party shall forfeit and 
pay a civil penalty in an amount not to exceed the applicable 
maximum amount determined under paragraph (4) for each 
day during which such violation, practice, or breach continues, 
if such regulated entity or entity-affiliated party— 
‘‘(A) knowingly— 
‘‘(i) commits any violation described in any 
subparagraph of paragraph (1); 
‘‘(ii) engages in any unsafe or unsound practice 
in conducting the affairs of the regulated entity; or 
‘‘(iii) breaches any fiduciary duty; and 
‘‘(B) knowingly or recklessly causes a substantial loss 
to the regulated entity or a substantial pecuniary gain 
or other benefit to such party by reason of such violation, 
practice, or breach. 
‘‘(4) MAXIMUM AMOUNTS OF PENALTIES FOR ANY VIOLATION 
DESCRIBED IN PARAGRAPH (3).—The maximum daily amount of 
any civil penalty which may be assessed pursuant to paragraph 
(3) for any violation, practice, or breach described in paragraph 
(3) is— 
‘‘(A) in the case of any entity-affiliated party, an 
amount not to exceed $2,000,000; and 
‘‘(B) in the case of any regulated entity, $2,000,000.’’; 
(3) in subsection (c)— 
(A) by striking ‘‘enterprise’’ each place that term 
appears and inserting ‘‘regulated entity’’; 
(B) by inserting ‘‘or entity-affiliated party’’ before ‘‘in 
writing’’; and 
(C) by inserting ‘‘or entity-affiliated party’’ before ‘‘has 
been given’’; 
(4) in subsection (d)— 
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122 STAT. 2777 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) by striking ‘‘or director’’ each place such term 
appears and inserting ‘‘director, or entity-affiliated party’’; 
(B) by striking ‘‘an enterprise’’ and inserting ‘‘a regu-
lated entity’’; 
(C) by striking ‘‘the enterprise’’ and inserting ‘‘the regu-
lated entity’’; 
(D) by striking ‘‘request the Attorney General of the 
United States to’’; 
(E) by inserting ‘‘, or the United States district court 
within the jurisdiction of which the headquarters of the 
regulated entity is located,’’ after ‘‘District of Columbia’’; 
(F) by striking ‘‘, or may, under the direction and 
control of the Attorney General of the United States, bring 
such an action’’; and 
(G) by striking ‘‘and section 1374’’; and 
(5) in subsection (g), by striking ‘‘An enterprise’’ and 
inserting ‘‘A regulated entity’’. 
SEC. 1156. CRIMINAL PENALTY. 
(a) IN GENERAL.—Subtitle C of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992 (12 U.S.C. 4631 et 
seq.) is amended by inserting after section 1377, as added by 
this Act, the following: 
‘‘SEC. 1378. CRIMINAL PENALTY. 
‘‘Whoever, being subject to an order in effect under section 
1377, without the prior written approval of the Director, knowingly 
participates, directly or indirectly, in any manner (including by 
engaging in an activity specifically prohibited in such an order) 
in the conduct of the affairs of any regulated entity shall, notwith-
standing section 3571 of title 18, be fined not more than $1,000,000, 
imprisoned for not more than 5 years, or both.’’. 
(b) TECHNICAL AND CONFORMING AMENDMENTS.—The Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992 
(12 U.S.C. 4501 et seq.) is amended— 
(1) in section 1379 (as so designated by this Act)— 
(A) by striking ‘‘an enterprise’’ and inserting ‘‘a regu-
lated entity’’; and 
(B) by striking ‘‘the enterprise’’ and inserting ‘‘the regu-
lated entity’’; 
(2) in section 1379A (as so designated by this Act), by 
striking ‘‘an enterprise’’ and inserting ‘‘a regulated entity’’; 
(3) in section 1379B(c) (as so designated by this Act), by 
striking ‘‘enterprise’’ and inserting ‘‘regulated entity’’; and 
(4) in section 1379D (as so designated by this Act), by 
striking ‘‘enterprise’’ and inserting ‘‘regulated entity’’. 
SEC. 1157. NOTICE AFTER SEPARATION FROM SERVICE. 
Section 1379 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4637), as so designated 
by this Act, is amended— 
(1) by striking ‘‘2-year’’ and inserting ‘‘6-year’’; 
(2) by striking ‘‘a director or executive officer of an enter-
prise’’ and inserting ‘‘an entity-affiliated party’’; 
(3) by striking ‘‘director or officer’’ each place that term 
appears and inserting ‘‘entity-affiliated party’’; and 
(4) by striking ‘‘enterprise.’’ and inserting ‘‘regulated 
entity.’’. 
12 USC 4641. 
12 USC 4639. 
12 USC 4638. 
12 USC 4637. 
12 USC 4636b. 
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122 STAT. 2778 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1158. SUBPOENA AUTHORITY. 
(a) IN GENERAL.—Section 1379B of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4641) 
is amended— 
(1) in subsection (a)— 
(A) in the matter preceding paragraph (1)— 
(i) by striking ‘‘administrative’’; 
(ii) by inserting ‘‘, examination, or investigation’’ 
after ‘‘proceeding’’; 
(iii) by striking ‘‘subtitle’’ and inserting ‘‘title’’; and 
(iv) by inserting ‘‘or any designated representative 
thereof, including any person designated to conduct 
any hearing under this subtitle’’ after ‘‘Director’’; and 
(B) in paragraph (4), by striking ‘‘issued by the 
Director’’; 
(2) in subsection (b), by inserting ‘‘or in any territory or 
other place subject to the jurisdiction of the United States’’ 
after ‘‘State’’; 
(3) by striking subsection (c) and inserting the following: 
‘‘(c) ENFORCEMENT.— 
‘‘(1) IN GENERAL.—The Director, or any party to proceedings 
under this subtitle, may apply to the United States District 
Court for the District of Columbia, or the United States district 
court for the judicial district of the United States in any terri-
tory in which such proceeding is being conducted, or where 
the witness resides or carries on business, for enforcement 
of any subpoena or subpoena duces tecum issued pursuant 
to this section. 
‘‘(2) POWER OF COURT.—The courts described under para-
graph (1) shall have the jurisdiction and power to order and 
require compliance with any subpoena issued under paragraph 
(1).’’; 
(4) in subsection (d), by inserting ‘‘enterprise-affiliated 
party’’ before ‘‘may allow’’; and 
(5) by adding at the end the following: 
‘‘(e) PENALTIES.—A person shall be guilty of a misdemeanor, 
and upon conviction, shall be subject to a fine of not more than 
$1,000 or to imprisonment for a term of not more than 1 year, 
or both, if that person willfully fails or refuses, in disobedience 
of a subpoena issued under subsection (c), to— 
‘‘(1) attend court; 
‘‘(2) testify in court; 
‘‘(3) answer any lawful inquiry; or 
‘‘(4) produce books, papers, correspondence, contracts, 
agreements, or such other records as requested in the sub-
poena.’’. 
Subtitle E—General Provisions 
SEC. 1161. CONFORMING AND TECHNICAL AMENDMENTS. 
(a) AMENDMENTS TO 1992 ACT.—The Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4501 
et seq.), as amended by this Act, is amended— 
(1) in section 1315 (12 U.S.C. 4515)— 
(A) in subsection (a)— 
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122 STAT. 2779 
PUBLIC LAW 110–289—JULY 30, 2008 
(i) by striking ‘‘(a) OFFICE PERSONNEL.—The’’ and 
inserting ‘‘(a) IN GENERAL.—Subject to title III of the 
Federal Housing Finance Regulatory Reform Act of 
2008, the’’; and 
(ii) by striking ‘‘the Office’’ each place that term 
appears and inserting ‘‘the Agency’’; 
(B) in subsection (c), by striking ‘‘the Office’’ and 
inserting ‘‘the Agency’’; 
(C) in subsection (e), by striking ‘‘the Office’’ and 
inserting ‘‘the Agency’’; 
(D) by striking subsection (d) and redesignating sub-
section (e) as subsection (d); and 
(E) by striking subsection (f); 
(2) in section 1319A (12 U.S.C. 4520)— 
(A) by striking ‘‘(a) IN GENERAL.—’’; and 
(B) by striking subsection (b); 
(3) in section 1364(c) (12 U.S.C. 4614(c)), by striking the 
last sentence; 
(4) by striking section 1383 (12 U.S.C. 1451 note); 
(5) in each of sections 1319D, 1319E, and 1319F (12 U.S.C. 
4523, 4524, 4525) by striking ‘‘the Office’’ each place that term 
appears and inserting ‘‘the Agency’’; and 
(6) in each of sections 1319B and 1369(a)(3) (12 U.S.C. 
4521, 4619(a)(3)), by striking ‘‘Committee on Banking, Finance 
and Urban Affairs’’ each place such term appears and inserting 
‘‘Committee on Financial Services’’. 
(b) AMENDMENTS TO FANNIE MAE CHARTER ACT.—The Federal 
National Mortgage Association Charter Act (12 U.S.C. 1716 et seq.) 
is amended— 
(1) in each of sections 303(c)(2) (12 U.S.C. 1718(c)(2)), 
309(d)(3)(B) (12 U.S.C. 1723a(d)(3)(B)), and 309(k)(1) (12 U.S.C. 
1723a(k)(1)), by striking ‘‘Director of the Office of Federal 
Housing Enterprise Oversight of the Department of Housing 
and Urban Development’’ each place that term appears, and 
inserting ‘‘Director of the Federal Housing Finance Agency’’; 
and 
(2) in section 309— 
(A) in subsection (m) (12 U.S.C. 1723a(m))— 
(i) in paragraph (1), by striking ‘‘to the Secretary, 
in a form determined by the Secretary’’ and inserting 
‘‘to the Director of the Federal Housing Finance 
Agency, in a form determined by the Director’’; and 
(ii) in paragraph (2), by striking ‘‘to the Secretary, 
in a form determined by the Secretary’’ and inserting 
‘‘to the Director of the Federal Housing Finance 
Agency, in a form determined by the Director’’; 
(B) in subsection (n) (12 U.S.C. 1723a(n))— 
(i) in paragraph (1), by striking ‘‘and the Secretary’’ 
and inserting ‘‘and the Director of the Federal Housing 
Finance Agency’’; and 
(ii) in paragraph (2), by striking ‘‘Secretary’’ each 
place that term appears and inserting ‘‘Director of 
the Federal Housing Finance Agency’’; and 
(C) in paragraph (3)(B), by striking ‘‘Secretary’’ and 
inserting ‘‘Director of the Federal Housing Finance 
Agency’’. 
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122 STAT. 2780 
PUBLIC LAW 110–289—JULY 30, 2008 
(c) AMENDMENTS TO FREDDIE MAC CHARTER ACT.—The Federal 
Home Loan Mortgage Corporation Act (12 U.S.C. 1451 et seq.) 
is amended— 
(1) in each of sections 303(b)(2) (12 U.S.C. 1452(b)(2)), 
303(h)(2) (12 U.S.C. 1452(h)(2)), and section 307(c)(1) (12 U.S.C. 
1456(c)(1)), by striking ‘‘Director of the Office of Federal 
Housing Enterprise Oversight of the Department of Housing 
and Urban Development’’ each place that term appears, and 
inserting ‘‘Director of the Federal Housing Finance Agency’’; 
(2) in section 306 (12 U.S.C. 1455)— 
(A) in subsection (c)(2), by inserting ‘‘the’’ after ‘‘Sec-
retary of’’; 
(B) in subsection (i)— 
(i) by striking ‘‘section 1316(c)’’ and inserting ‘‘sec-
tion 306(c)’’; and 
(ii) by striking ‘‘section 106’’ and inserting ‘‘section 
1316’’; and 
(C) in subsection (j)(2), by striking ‘‘of substantially’’ 
and inserting ‘‘or substantially’’; and 
(3) in section 307 (12 U.S.C. 1456)— 
(A) in subsection (e)— 
(i) in paragraph (1), by striking ‘‘to the Secretary, 
in a form determined by the Secretary’’ and inserting 
‘‘to the Director of the Federal Housing Finance 
Agency, in a form determined by the Director’’; and 
(ii) in paragraph (2), by striking ‘‘to the Secretary, 
in a form determined by the Secretary’’ and inserting 
‘‘to the Director of the Federal Housing Finance 
Agency, in a form determined by the Director’’; and 
(B) in subsection (f)— 
(i) in paragraph (1), by striking ‘‘and the Secretary’’ 
and inserting ‘‘and the Director of the Federal Housing 
Finance Agency’’; 
(ii) in paragraph (2), by striking ‘‘the Secretary’’ 
each place that term appears and inserting ‘‘the 
Director of the Federal Housing Finance Agency’’; and 
(iii) in paragraph (3)(B), by striking ‘‘Secretary’’ 
and inserting ‘‘Director of the Federal Housing Finance 
Agency’’. 
(d) AMENDMENT TO TITLE 18, UNITED STATES CODE.—Section 
1905 of title 18, United States Code, is amended by striking ‘‘Office 
of Federal Housing Enterprise Oversight’’ and inserting ‘‘Federal 
Housing Finance Agency’’. 
(e) AMENDMENTS
TO FLOOD DISASTER PROTECTION ACT
OF 
1973.—Section 102(f)(3)(A) of the Flood Disaster Protection Act 
of 1973 (42 U.S.C. 4012a(f)(3)(A)) is amended by striking ‘‘Director 
of the Office of Federal Housing Enterprise Oversight of the Depart-
ment of Housing and Urban Development’’ and inserting ‘‘Director 
of the Federal Housing Finance Agency’’. 
(f) AMENDMENT
TO DEPARTMENT
OF HOUSING
AND URBAN 
DEVELOPMENT ACT.—Section 5 of the Department of Housing and 
Urban Development Act (42 U.S.C. 3534) is amended by striking 
subsection (d). 
(g) AMENDMENTS TO TITLE 5, UNITED STATES CODE.—Title 5, 
United States Code, is amended— 
(1) in section 5313, by striking the item relating to the 
Director of the Office of Federal Housing Enterprise Oversight, 
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122 STAT. 2781 
PUBLIC LAW 110–289—JULY 30, 2008 
Department of Housing and Urban Development and inserting 
the following new item: 
‘‘Director of the Federal Housing Finance Agency.’’; and 
(2) in section 3132(a)(1)— 
(A) in subparagraph (B), by striking ‘‘,, and’’ and 
inserting ‘‘, and’’; 
(B) in subparagraph (D)— 
(i) by striking ‘‘the Federal Housing Finance 
Board’’; 
(ii) by striking ‘‘the Office of Federal Housing 
Enterprise Oversight of the Department of Housing 
and Urban Development’’ and inserting ‘‘the Federal 
Housing Finance Agency’’; and 
(iii) by striking ‘‘or or’’ at the end; 
(C) in subparagraph (E), as added by section 
8(d)(1)(B)(iii) of Public Law 107–123, by adding ‘‘or’’ at 
the end; and 
(D) by redesignating subparagraph (E), as added by 
section 10702(c)(1)(C) of Public Law 107–171, as subpara-
graph (F). 
(h) 
AMENDMENT
TO
SARBANES-OXLEY
ACT.—Section 
105(b)(5)(B)(ii)(II) of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 
7215(b)(5)(B)(ii)(II)) is amended by inserting ‘‘and the Director of 
the Federal Housing Finance Agency,’’ after ‘‘Commission,’’. 
(i) AMENDMENT TO FEDERAL DEPOSIT INSURANCE ACT.—Section 
11(t)(2)(A) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(t)(2)(A)) is amended by adding at the end the following: 
‘‘(vii) Federal Housing Finance Agency.’’. 
SEC. 1162. PRESIDENTIALLY-APPOINTED DIRECTORS OF ENTER-
PRISES. 
(a) FANNIE MAE.— 
(1) IN GENERAL.—Section 308(b) of the Federal National 
Mortgage Association Charter Act (12 U.S.C. 1723(b)) is 
amended— 
(A) in the first sentence, by striking ‘‘eighteen persons, 
five of whom shall be appointed annually by the President 
of the United States, and the remainder of whom’’ and 
inserting ‘‘13 persons, or such other number that the 
Director determines appropriate, who’’; 
(B) in the second sentence, by striking ‘‘appointed by 
the President’’; 
(C) in the third sentence— 
(i) by striking ‘‘appointed or’’; and 
(ii) by striking ‘‘, except that any such appointed 
member may be removed from office by the President 
for good cause’’; 
(D) in the fourth sentence, by striking ‘‘elective’’; and 
(E) by striking the fifth sentence. 
(2) TRANSITIONAL PROVISION.—The amendments made by 
paragraph (1) shall not apply to any appointed position of 
the board of directors of the Federal National Mortgage Associa-
tion until the expiration of the annual term for such position 
during which the effective date under section 1163 occurs. 
(b) FREDDIE MAC.— 
12 USC 1723 
note. 
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122 STAT. 2782 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) IN GENERAL.—Section 303(a)(2) of the Federal Home 
Loan Mortgage Corporation Act (12 U.S.C. 1452(a)(2)) is 
amended— 
(A) in subparagraph (A)— 
(i) in the first sentence, by striking ‘‘18 persons, 
5 of whom shall be appointed annually by the President 
of the United States and the remainder of whom’’ 
and inserting ‘‘13 persons, or such other number as 
the Director determines appropriate, who’’; and 
(ii) in the second sentence, by striking ‘‘appointed 
by the President of the United States’’; 
(B) in subparagraph (B)— 
(i) by striking ‘‘such or’’; and 
(ii) by striking ‘‘, except that any appointed 
member may be removed from office by the President 
for good cause’’; and 
(C) in subparagraph (C)— 
(i) by striking the first sentence; and 
(ii) by striking ‘‘elective’’. 
(2) TRANSITIONAL PROVISION.—The amendments made by 
paragraph (1) shall not apply to any appointed position of 
the board of directors of the Federal Home Loan Mortgage 
Corporation until the expiration of the annual term for such 
position during which the effective date under section 1163 
occurs. 
SEC. 1163. EFFECTIVE DATE. 
Except as otherwise specifically provided in this title, this title 
and the amendments made by this title shall take effect on, and 
shall apply beginning on, the date of enactment of this Act. 
TITLE II—FEDERAL HOME LOAN BANKS 
SEC. 1201. RECOGNITION OF DISTINCTIONS BETWEEN THE ENTER-
PRISES AND THE FEDERAL HOME LOAN BANKS. 
Section 1313 of the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992 (12 U.S.C. 4513) is amended 
by adding at the end the following: 
‘‘(f) RECOGNITION OF DISTINCTIONS BETWEEN THE ENTERPRISES 
AND THE FEDERAL HOME LOAN BANKS.—Prior to promulgating any 
regulation or taking any other formal or informal agency action 
of general applicability and future effect relating to the Federal 
Home Loan Banks (other than any regulation, advisory document, 
or examination guidance of the Federal Housing Finance Board 
that the Director reissues after the authority of the Director over 
the Federal Home Loan Banks takes effect), including the issuance 
of an advisory document or examination guidance, the Director 
shall consider the differences between the Federal Home Loan 
Banks and the enterprises with respect to— 
‘‘(1) the Banks’— 
‘‘(A) cooperative ownership structure; 
‘‘(B) the mission of providing liquidity to members; 
‘‘(C) affordable housing and community development 
mission; 
‘‘(D) capital structure; and 
‘‘(E) joint and several liability; and 
5 USC 13132 
note. 
12 USC 1452 
note. 
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122 STAT. 2783 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) any other differences that the Director considers appro-
priate.’’. 
SEC. 1202. DIRECTORS. 
Section 7 of the Federal Home Loan Bank Act (12 U.S.C. 
1427) is amended— 
(1) by striking subsection (a) and inserting the following: 
‘‘(a) NUMBER; ELECTION; QUALIFICATIONS; CONFLICTS
OF 
INTEREST.— 
‘‘(1) IN GENERAL.—Subject to paragraphs (2) through (4), 
the management of each Federal Home Loan Bank shall be 
vested in a board of 13 directors, or such other number as 
the Director determines appropriate. 
‘‘(2) BOARD MAKEUP.—The board of directors of each Bank 
shall be comprised of— 
‘‘(A) member directors, who shall comprise at least 
the majority of the members of the board of directors; 
and 
‘‘(B) independent directors, who shall comprise not 
fewer than 2⁄5 of the members of the board of directors. 
‘‘(3) SELECTION CRITERIA.— 
‘‘(A) IN GENERAL.—Each member of the board of direc-
tors shall be— 
‘‘(i) elected by plurality vote of the members, in 
accordance with procedures established under this sec-
tion; and 
‘‘(ii) a citizen of the United States. 
‘‘(B) INDEPENDENT DIRECTOR CRITERIA.— 
‘‘(i) IN GENERAL.—Each independent director that 
is not a public interest director under clause (ii) shall 
have demonstrated knowledge of, or experience in, 
financial management, auditing and accounting, risk 
management practices, derivatives, project develop-
ment, or organizational management, or such other 
knowledge or expertise as the Director may provide 
by regulation. 
‘‘(ii) PUBLIC INTEREST.—Not fewer than 2 of the 
independent directors shall have more than 4 years 
of experience in representing consumer or community 
interests on banking services, credit needs, housing, 
or financial consumer protections. 
‘‘(iii) CONFLICTS
OF
INTEREST.—No independent 
director may, during the term of service on the board 
of directors, serve as an officer of any Federal Home 
Loan Bank or as a director, officer, or employee of 
any member of a Bank, or of any person that receives 
advances from a Bank. 
‘‘(4) DEFINITIONS.—For purposes of this section, the fol-
lowing definitions shall apply: 
‘‘(A) INDEPENDENT DIRECTOR.—The terms ‘independent 
director’ and ‘independent directorship’ mean a member 
of the board of directors of a Federal Home Loan Bank 
who is a bona fide resident of the district in which the 
Federal Home Loan Bank is located, or the directorship 
held by such a person, respectively. 
‘‘(B) MEMBER DIRECTOR.—The terms ‘member director’ 
and ‘member directorship’ mean a member of the board 
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122 STAT. 2784 
PUBLIC LAW 110–289—JULY 30, 2008 
of directors of a Federal Home Loan Bank who is an 
officer or director of a member institution that is located 
in the district in which the Federal Home Loan Bank 
is located, or the directorship held by such a person, respec-
tively.’’; 
(2) by striking ‘‘elective’’ each place that term appears, 
other than in subsections (d), (e), and (f), and inserting 
‘‘member’’; 
(3) in subsection (b)— 
(A) by striking the subsection heading and all that 
follows through ‘‘Each elective directorship’’ and inserting 
the following: 
‘‘(b) DIRECTORSHIPS.— 
‘‘(1) MEMBER DIRECTORSHIPS.—Each member directorship’’; 
and 
(B) by adding at the end the following: 
‘‘(2) INDEPENDENT DIRECTORSHIPS.— 
‘‘(A) ELECTIONS.—Each independent director— 
‘‘(i) shall be elected by the members entitled to 
vote, from among eligible persons nominated, after con-
sultation with the Advisory Council of the Bank, by 
the board of directors of the Bank; and 
‘‘(ii) shall be elected by a plurality of the votes 
of the members of the Bank at large, with each member 
having the number of votes for each such directorship 
as it has under paragraph (1) in an election to fill 
member directorships. 
‘‘(B) CRITERIA.—Nominees shall meet all applicable 
requirements prescribed in this section. 
‘‘(C) NOMINATION AND ELECTION PROCEDURES.—Proce-
dures for nomination and election of independent directors 
shall be prescribed by the bylaws of each Federal Home 
Loan Bank, in a manner consistent with the rules and 
regulations of the Agency.’’; 
(4) in subsection (c)— 
(A) by striking ‘‘elective’’ each place that term appears 
and inserting ‘‘member’’, except— 
(i) in the second sentence, the second place that 
term appears; and 
(ii) each place that term appears in the fifth sen-
tence; and 
(B) in the second sentence— 
(i) by inserting ‘‘(A) except as provided in clause 
(B) of this sentence,’’ before ‘‘if at any time’’; and 
(ii) by inserting before the period at the end the 
following: ‘‘, and (B) clause (A) of this sentence shall 
not apply to the directorships of any Federal Home 
Loan Bank resulting from the merger of any 2 or 
more such Banks’’; 
(5) in subsection (d)— 
(A) in the first sentence— 
(i) by striking ‘‘, whether elected or appointed,’’; 
and 
(ii) by striking ‘‘3 years’’ and inserting ‘‘4 years’’; 
(B) in the second sentence— 
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122 STAT. 2785 
PUBLIC LAW 110–289—JULY 30, 2008 
(i) by striking ‘‘Federal Home Loan Bank System 
Modernization Act of 1999’’ and inserting ‘‘Federal 
Housing Finance Regulatory Reform Act of 2008’’; 
(ii) by striking ‘‘1⁄3’’ and inserting ‘‘1⁄4’’; and 
(iii) by striking ‘‘or appointed’’; and 
(C) in the third sentence— 
(i) by striking ‘‘an elective’’ each place that term 
appears and inserting ‘‘a’’; and 
(ii) by striking ‘‘in any elective directorship or elec-
tive directorships’’; 
(6) in subsection (f)— 
(A) by striking paragraph (2); 
(B) by striking ‘‘appointed or’’ each place that term 
appears; and 
(C) in paragraph (3)— 
(i) by striking ‘‘(3) ELECTED BANK DIRECTORS.— 
’’ and inserting ‘‘(2) ELECTION PROCESS.—’’; and 
(ii) by striking ‘‘elective’’ each place that term 
appears; 
(7) in subsection (i)— 
(A) in paragraph (1), by striking ‘‘Subject to paragraph 
(2), each’’ and inserting ‘‘Each’’; and 
(B) by striking paragraph (2) and inserting the fol-
lowing: 
‘‘(2) ANNUAL REPORT.—The Director shall include, in the 
annual report submitted to the Congress pursuant to section 
1319B of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992, information regarding the com-
pensation and expenses paid by the Federal Home Loan Banks 
to the directors on the boards of directors of the Banks.’’; 
and 
(8) by adding at the end the following: 
‘‘(l) TRANSITION RULE.—Any member of the board of directors 
of a Bank elected or appointed in accordance with this section 
prior to the date of enactment of this subsection may continue 
to serve as a member of that board of directors for the remainder 
of the existing term of service.’’. 
SEC. 1203. DEFINITIONS. 
Section 2 of the Federal Home Loan Bank Act (12 U.S.C. 
1422) is amended— 
(1) by striking paragraphs (1), (10), and (11); 
(2) by redesignating paragraphs (2) through (9) as para-
graphs (1) through (8), respectively; 
(3) by redesignating paragraphs (12) and (13) as paragraphs 
(9) and (10), respectively; and 
(4) by adding at the end the following: 
‘‘(11) DIRECTOR.—The term ‘Director’ means the Director 
of the Federal Housing Finance Agency. 
‘‘(12) AGENCY.—The term ‘Agency’ means the Federal 
Housing Finance Agency, established under section 1311 of 
the Federal Housing Enterprises Financial Safety and Sound-
ness Act of 1992.’’. 
SEC. 1204. AGENCY OVERSIGHT OF FEDERAL HOME LOAN BANKS. 
The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.), 
other than in provisions of that Act added or amended otherwise 
by this Act, is amended— 
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122 STAT. 2786 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) by striking sections 2A and 2B (12 U.S.C. 1422a, 1422b); 
(2) in section 18 (12 U.S.C. 1438), by striking subsection 
(b); 
(3) in section 11 (12 U.S.C. 1431)— 
(A) in subsection (b)— 
(i) in the first sentence— 
(I) by striking ‘‘The Board’’ and inserting ‘‘The 
Office of Finance, as agent for the Banks,’’; and 
(II) by striking ‘‘the Board’’ and inserting ‘‘such 
Office’’; and 
(ii) in the second and fourth sentences, by striking 
‘‘the Board’’ each place such term appears and inserting 
‘‘the Office of Finance’’; 
(B) in subsection (c)— 
(i) by striking ‘‘the Board’’ the first place such 
term appears and inserting ‘‘the Office of Finance, 
as agent for the Banks,’’; and 
(ii) by striking ‘‘the Board’’ the second place such 
term appears and inserting ‘‘such Office’’; and 
(C) in subsection (f)— 
(i) by striking the 2 commas after ‘‘permit’’ and 
inserting ‘‘or’’; and 
(ii) by striking the comma after ‘‘require’’; 
(4) in section 6 (12 U.S.C. 1426)— 
(A) in subsection (b)(1), in the matter preceding 
subparagraph (A), by striking ‘‘Finance Board approval’’ 
and inserting ‘‘approval by the Director’’; and 
(B) in each of subsections (c)(4)(B) and (d)(2), by 
striking ‘‘Finance Board regulations’’ each place that term 
appears and inserting ‘‘regulations of the Director’’; 
(5) in section 10(b) (12 U.S.C. 1430(b))— 
(A) in the subsection heading, by striking ‘‘FORMAL 
BOARD
RESOLUTION’’ 
and 
inserting 
‘‘APPROVAL
OF 
DIRECTOR’’; and 
(B) by striking ‘‘by formal resolution’’; 
(6) in section 21(b)(5) (12 U.S.C. 1441(b)(5)), by striking 
‘‘Chairperson of the Federal Housing Finance Board’’ and 
inserting ‘‘Director’’; 
(7) in section 15 (12 U.S.C. 1435), by inserting ‘‘or the 
Director’’ after ‘‘the Board’’; 
(8) by striking ‘‘the Board’’ each place that term appears 
and inserting ‘‘the Director’’; 
(9) by striking ‘‘The Board’’ each place that term appears 
and inserting ‘‘The Director’’; 
(10) by striking ‘‘the Finance Board’’ each place that term 
appears and inserting ‘‘the Director’’; 
(11) by striking ‘‘The Finance Board’’ each place that term 
appears and inserting ‘‘The Director’’; and 
(12) by striking ‘‘Federal Housing Finance Board’’ each 
place that term appears and inserting ‘‘Director’’. 
SEC. 1205. HOUSING GOALS. 
The Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.) 
is amended by inserting after section 10b the following new section: 
‘‘SEC. 10C. HOUSING GOALS. 
‘‘(a) IN GENERAL.—The Director shall establish housing goals 
with respect to the purchase of mortgages, if any, by the Federal 
12 USC 1430c. 
12 USC 
1430 et al. 
12 USC 
1422 et al. 
12 USC 
1427 et al. 
12 USC 
1422 et al. 
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122 STAT. 2787 
PUBLIC LAW 110–289—JULY 30, 2008 
Home Loan Banks. Such goals shall be consistent with the goals 
established under sections 1331 through 1334 of the Federal 
Housing Enterprises Financial Safety and Soundness Act of 1992. 
‘‘(b) CONSIDERATIONS.—In establishing the goals required by 
subsection (a), the Director shall consider the unique mission and 
ownership structure of the Federal Home Loan Banks. 
‘‘(c) TRANSITION PERIOD.—To facilitate an orderly transition, 
the Director shall establish interim target goals for purposes of 
this section for each of the 2 calendar years following the date 
of enactment of this section. 
‘‘(d) MONITORING AND ENFORCEMENT OF GOALS.—The require-
ments of section 1336 of the Federal Housing Enterprises Safety 
and Soundness Act of 1992, shall apply to this section, in the 
same manner and to the same extent as that section applies to 
the Federal housing enterprises. 
‘‘(e) ANNUAL REPORT.—The Director shall annually report to 
Congress on the performance of the Banks in meeting the goals 
established under this section.’’. 
SEC. 1206. COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS. 
Section 4(a)(1) of the Federal Home Loan Bank Act (12 U.S.C. 
1424(a)(1)) is amended— 
(1) by inserting after ‘‘savings bank,’’ the following: 
‘‘community development financial institution,’’; and 
(2) in subparagraph (B), by inserting after ‘‘United States,’’ 
the following: ‘‘or, in the case of a community development 
financial institution, is certified as a community development 
financial institution under the Community Development 
Banking and Financial Institutions Act of 1994.’’. 
SEC. 1207. SHARING OF INFORMATION AMONG FEDERAL HOME LOAN 
BANKS. 
The Federal Home Loan Bank Act is amended by inserting 
after section 20 (12 U.S.C. 1440) the following new section: 
‘‘SEC. 20A. SHARING OF INFORMATION AMONG FEDERAL HOME LOAN 
BANKS. 
‘‘(a) INFORMATION ON FINANCIAL CONDITION.—In order to enable 
each Federal Home Loan Bank to evaluate the financial condition 
of one or more of the other Federal Home Loan Banks individually 
and the Federal Home Loan Bank System (including any risks 
associated with the issuance or repayment of consolidated Federal 
Home Loan Bank bonds and debentures or other borrowings and 
the joint and several liabilities of the Banks incurred due to such 
borrowings), as well as to comply with any of its obligations under 
the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.), the 
Director shall make available to the Banks such reports, records, 
or other information as may be available, relating to the condition 
of any Federal Home Loan Bank. 
‘‘(b) SHARING OF INFORMATION.— 
‘‘(1) IN GENERAL.—The Director shall promulgate regula-
tions to facilitate the sharing of information made available 
under subsection (a) directly among the Federal Home Loan 
Banks. 
‘‘(2) LIMITATION.—Notwithstanding paragraph (1), a Fed-
eral Home Loan Bank responding to a request from another 
Bank or from the Director for information pursuant to this 
section may request that the Director determine that such 
Regulations. 
Reports. 
Records. 
12 USC 1440a. 
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122 STAT. 2788 
PUBLIC LAW 110–289—JULY 30, 2008 
information is proprietary and that the public interest requires 
that such information not be shared. 
‘‘(c) LIMITATION.—Nothing in this section shall affect the obliga-
tions of any Federal Home Loan Bank under the Securities 
Exchange Act of 1934 (15 U.S.C. 78a et seq.) or the regulations 
issued by the Securities and Exchange Commission thereunder. 
‘‘(d) NO WAIVER
OF PRIVILEGE.—The Director shall not be 
deemed to have waived any privilege applicable to any information 
concerning a Federal Home Loan Bank by transferring, or permit-
ting the transfer of, that information to any other Federal Home 
Loan Bank for the purposes set out in subsection (a).’’. 
SEC. 1208. EXCLUSION FROM CERTAIN REQUIREMENTS. 
(a) IN GENERAL.—The Federal Home Loan Banks shall be 
exempt from compliance with— 
(1) sections 13(e), 14(a), and 14(c) of the Securities 
Exchange Act of 1934, and related Commission regulations; 
(2) section 15 of the Securities Exchange Act of 1934, 
and related Commission regulations, with respect to trans-
actions in the capital stock of a Federal Home Loan Bank; 
(3) section 17A of the Securities Exchange Act of 1934, 
and related Commission regulations, with respect to the 
transfer of the securities of a Federal Home Loan Bank; and 
(4) the Trust Indenture Act of 1939. 
(b) MEMBER EXEMPTION.—The members of the Federal Home 
Loan Bank System shall be exempt from compliance with sections 
13(d), 13(f), 13(g), 14(d), and 16 of the Securities Exchange Act 
of 1934, and related Commission regulations, with respect to owner-
ship of or transactions in the capital stock of the Federal Home 
Loan Banks by such members. 
(c) EXEMPTED AND GOVERNMENT SECURITIES.— 
(1) CAPITAL STOCK.—The capital stock issued by each of 
the Federal Home Loan Banks under section 6 of the Federal 
Home Loan Bank Act are— 
(A) exempted securities, within the meaning of section 
3(a)(2) of the Securities Act of 1933; and 
(B) exempted securities, within the meaning of section 
3(a)(12)(A) of the Securities Exchange Act of 1934, except 
to the extent provided in section 38 of that Act. 
(2) OTHER OBLIGATIONS.—The debentures, bonds, and other 
obligations issued under section 11 of the Federal Home Loan 
Bank Act (12 U.S.C. 1431) are— 
(A) exempted securities, within the meaning of section 
3(a)(2) of the Securities Act of 1933; 
(B) government securities, within the meaning of sec-
tion 3(a)(42) of the Securities Exchange Act of 1934; and 
(C) government securities, within the meaning of sec-
tion 2(a)(16) of the Investment Company Act of 1940. 
(3) BROKERS AND DEALERS.—A person (other than a Federal 
Home Loan Bank effecting transactions for members of the 
Federal Home Loan Bank System) that effects transactions 
in the capital stock or other obligations of a Federal Home 
Loan Bank, for the account of others or for that person’s own 
account, as applicable, is a broker or dealer, as those terms 
are defined in paragraphs (4) and (5), respectively, of section 
3(a) of the Securities Exchange Act of 1934, but is excluded 
from the definition of— 
12 USC 1426a. 
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122 STAT. 2789 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) the term ‘‘government securities broker’’ under sec-
tion 3(a)(43) of the Securities Exchange Act of 1934; and 
(B) the term ‘‘government securities dealer’’ under sec-
tion 3(a)(44) of the Securities Exchange Act of 1934. 
(d) EXEMPTION FROM REPORTING REQUIREMENTS.—The Federal 
Home Loan Banks shall be exempt from periodic reporting require-
ments under the securities laws pertaining to the disclosure of— 
(1) related party transactions that occur in the ordinary 
course of the business of the Banks with members; and 
(2) the unregistered sales of equity securities. 
(e) TENDER OFFERS.—Commission rules relating to tender offers 
shall not apply in connection with transactions in the capital stock 
of the Federal Home Loan Banks. 
(f) REGULATIONS.— 
(1) IN GENERAL.—The Commission shall promulgate such 
rules and regulations as may be necessary or appropriate in 
the public interest or in furtherance of this section and the 
exemptions provided in this section. 
(2) CONSIDERATIONS.—In issuing regulations under this sec-
tion, the Commission shall consider the distinctive characteris-
tics of the Federal Home Loan Banks when evaluating— 
(A) the accounting treatment with respect to the pay-
ment to the Resolution Funding Corporation; 
(B) the role of the combined financial statements of 
the Federal Home Loan Banks; 
(C) the accounting classification of redeemable capital 
stock; and 
(D) the accounting treatment related to the joint and 
several nature of the obligations of the Banks. 
(g) DEFINITIONS.—As used in this section— 
(1) the terms ‘‘Bank’’, ‘‘Federal Home Loan Bank’’, 
‘‘member’’, and ‘‘Federal Home Loan Bank System’’ have the 
same meanings as in section 2 of the Federal Home Loan 
Bank Act (12 U.S.C. 1422); 
(2) the term ‘‘Commission’’ means the Securities and 
Exchange Commission; and 
(3) the term ‘‘securities laws’’ has the same meaning as 
in section 3(a)(47) of the Securities Exchange Act of 1934 (15 
U.S.C. 78c(a)(47)). 
SEC. 1209. VOLUNTARY MERGERS. 
Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 
1446) is amended— 
(1) by striking ‘‘Whenever’’ and inserting ‘‘(a) IN GEN-
ERAL.—Whenever’’; and 
(2) by adding at the end the following: 
‘‘(b) VOLUNTARY MERGERS AUTHORIZED.— 
‘‘(1) IN
GENERAL.—Any Federal Home Loan Bank may, 
with the approval of the Director and of the boards of directors 
of the Banks involved, merge with another Bank. 
‘‘(2) REGULATIONS REQUIRED.—The Director shall promul-
gate regulations establishing the conditions and procedures 
for the consideration and approval of any voluntary merger 
described in paragraph (1), including the procedures for Bank 
member approval.’’. 
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122 STAT. 2790 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1210. AUTHORITY TO REDUCE DISTRICTS. 
Section 3 of the Federal Home Loan Bank Act (12 U.S.C. 
1423) is amended— 
(1) by striking ‘‘As soon’’ and inserting ‘‘(a) IN GENERAL.— 
As soon’’; and 
(2) by adding at the end the following: 
‘‘(b) AUTHORITY TO REDUCE DISTRICTS.—Notwithstanding sub-
section (a), the number of districts may be reduced to a number 
less than 8— 
‘‘(1) pursuant to a voluntary merger between Banks, as 
approved pursuant to section 26(b); or 
‘‘(2) pursuant to a decision by the Director to liquidate 
a Bank pursuant to section 1367 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992.’’. 
SEC. 1211. COMMUNITY FINANCIAL INSTITUTION MEMBERS. 
(a) TOTAL ASSET REQUIREMENT.—Paragraph (10) of section 2 
of the Federal Home Loan Bank Act (12 U.S.C. 1422(10)), as so 
redesignated by section 201(3) of this Act, is amended by striking 
‘‘$500,000,000’’ each place such term appears and inserting 
‘‘$1,000,000,000’’. 
(b) USE OF ADVANCES FOR COMMUNITY DEVELOPMENT ACTIVI-
TIES.—Section 10(a) of the Federal Home Loan Bank Act (12 U.S.C. 
1430(a)) is amended— 
(1) in paragraph (2)(B)— 
(A) by striking ‘‘and’’; and 
(B) by inserting ‘‘, and community development activi-
ties’’ before the period at the end; 
(2) in paragraph (3)(E), by inserting ‘‘or community develop-
ment activities’’ after ‘‘agriculture,’’; and 
(3) in paragraph (6)— 
(A) by striking ‘‘and’’; and 
(B) by inserting ‘‘, and ‘community development activi-
ties’ ’’ before ‘‘shall’’. 
SEC. 1212. PUBLIC USE DATABASE; REPORTS TO CONGRESS. 
Section 10 of the Federal Home Loan Bank Act (12 U.S.C. 
1430) is amended— 
(1) in subsection (j)(12)— 
(A) by striking subparagraph (C) and inserting the 
following: 
‘‘(C) REPORTS.—The Director shall annually report to 
the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services 
of the House of Representatives on the collateral pledged 
to the Banks, including an analysis of collateral by type 
and by Bank district.’’; and 
(B) by adding at the end the following: 
‘‘(D) SUBMISSION
TO
CONGRESS.—The Director shall 
submit the reports under subparagraphs (A) and (C) to 
the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services 
of the House of Representatives, not later than 180 days 
after the date of enactment of the Federal Housing Finance 
Regulatory Reform Act of 2008.’’; and 
(2) by adding at the end the following: 
‘‘(k) PUBLIC USE DATABASE.— 
Deadline. 
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122 STAT. 2791 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) DATA.—Each Federal Home Loan Bank shall provide 
to the Director, in a form determined by the Director, census 
tract level data relating to mortgages purchased, if any, 
including— 
‘‘(A) data consistent with that reported under section 
1323 of the Federal Housing Enterprises Financial Safety 
and Soundness Act of 1992; 
‘‘(B) data elements required to be reported under the 
Home Mortgage Disclosure Act of 1975; and 
‘‘(C) any other data elements that the Director con-
siders appropriate. 
‘‘(2) PUBLIC USE DATABASE.— 
‘‘(A) IN GENERAL.—The Director shall make available 
to the public, in a form that is useful to the public 
(including forms accessible electronically), and to the extent 
practicable, the data provided to the Director under para-
graph (1). 
‘‘(B) PROPRIETARY
INFORMATION.—Not withstanding 
subparagraph (A), the Director may not provide public 
access to, or disclose to the public, any information required 
to be submitted under this subsection that the Director 
determines is proprietary or that would provide personally 
identifiable information and that is not otherwise publicly 
accessible through other forms, unless the Director deter-
mines that it is in the public interest to provide such 
information.’’. 
SEC. 1213. SEMIANNUAL REPORTS. 
Section 21B of the Federal Home Loan Bank Act is amended 
in subsection (f)(2)(C), by adding at the end the following: 
‘‘(v) SEMIANNUAL
REPORTS.—The Director shall 
report semiannually to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of Rep-
resentatives on the projected date for the completion 
of contributions required by this section.’’. 
SEC. 1214. LIQUIDATION OR REORGANIZATION OF A FEDERAL HOME 
LOAN BANK. 
Section 26 of the Federal Home Loan Bank Act (12 U.S.C. 
1446) is amended by adding at the end the following: ‘‘At least 
30 days prior to liquidating or reorganizing any Bank under this 
section, the Director shall notify the Bank of its determination 
and the facts and circumstances upon which such determination 
is based. The Bank may contest that determination in a hearing 
before the Director, in which all issues shall be determined on 
the record pursuant to section 554 of title 5, United States Code.’’. 
SEC. 1215. STUDY AND REPORT TO CONGRESS ON SECURITIZATION 
OF ACQUIRED MEMBER ASSETS. 
(a) STUDY.—The Director shall conduct a study on securitization 
of home mortgage loans purchased or to be purchased from member 
financial institutions under the Acquired Member Assets programs. 
In conducting the study, the Director shall establish a process 
for the formal submission of comments. 
(b) ELEMENTS.—The study shall encompass— 
(1) the benefits and risks associated with securitization 
of Acquired Member Assets; 
Records. 
Deadline. 
Notification. 
12 USC 1441b. 
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122 STAT. 2792 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) the potential impact of securitization upon liquidity 
in the mortgage and broader credit markets; 
(3) the ability of the Federal Home Loan Bank or Banks 
in question to manage the risks associated with such a program; 
(4) the impact of such a program on the existing activities 
of the Banks, including their mortgage portfolios and advances; 
and 
(5) the joint and several liability of the Banks and the 
cooperative structure of the Federal Home Loan Bank System. 
(c) CONSULTATIONS.—In conducting the study under this sec-
tion, the Director shall consult with the Federal Home Loan Banks, 
the Banks’ fiscal agent, representatives of the mortgage lending 
industry, practitioners in the structured finance field, and other 
experts as needed. 
(d) REPORT.—Not later than 1 year after the date of enactment 
of this Act, the Director shall submit a report to Congress on 
the results of the study conducted under subsection (a), including 
policy recommendations based on the analysis of the Director of 
the feasibility of mortgage-backed securities issuance by a Federal 
Home Loan Bank or Banks and the risks and benefits associated 
with such program or programs. 
(e) DEFINITIONS.—As used in this section, the terms ‘‘member’’, 
‘‘Bank’’, and ‘‘Federal Home Loan Bank’’ have the same meanings 
as in section 2 of the Federal Home Loan Bank Act (12 U.S.C. 
1422). 
SEC. 1216. TECHNICAL AND CONFORMING AMENDMENTS. 
(a) RIGHT TO FINANCIAL PRIVACY ACT OF 1978.—Section 1113(o) 
of the Right to Financial Privacy Act of 1978 (12 U.S.C. 3413(o)) 
is amended— 
(1) by striking ‘‘Federal Housing Finance Board’’ and 
inserting ‘‘Federal Housing Finance Agency’’; and 
(2) by striking ‘‘Federal Housing Finance Board’s’’ and 
inserting ‘‘Federal Housing Finance Agency’s’’. 
(b) RIEGLE
COMMUNITY
DEVELOPMENT
AND
REGULATORY 
IMPROVEMENT ACT OF 1994.—Section 117(e) of the Riegle Commu-
nity Development and Regulatory Improvement Act of 1994 (12 
U.S.C. 4716(e)) is amended by striking ‘‘Federal Housing Finance 
Board’’ and inserting ‘‘Federal Housing Finance Agency’’. 
(c) TITLE 18, UNITED STATES CODE.—Title 18, United States 
Code, is amended by striking ‘‘Federal Housing Finance Board’’ 
each place such term appears in each of sections 212, 657, 1006, 
and 1014, and inserting ‘‘Federal Housing Finance Agency’’. 
(d) MAHRA ACT OF 1997.—Section 517(b)(4) of the Multifamily 
Assisted Housing Reform and Affordability Act of 1997 (42 U.S.C. 
1437f note) is amended by striking ‘‘Federal Housing Finance 
Board’’ and inserting ‘‘Federal Housing Finance Agency’’. 
(e) TITLE 44, UNITED STATES CODE.—Section 3502(5) of title 
44, United States Code, is amended by striking ‘‘Federal Housing 
Finance Board’’ and inserting ‘‘Federal Housing Finance Agency’’. 
(f) ACCESS TO LOCAL TV ACT OF 2000.—Section 1004(d)(2)(D)(iii) 
of the Launching Our Communities’ Access to Local Television 
Act of 2000 (47 U.S.C. 1103(d)(2)(D)(iii)) is amended by striking 
‘‘Office of Federal Housing Enterprise Oversight, the Federal 
Housing Finance Board’’ and inserting ‘‘Federal Housing Finance 
Agency’’. 
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122 STAT. 2793 
PUBLIC LAW 110–289—JULY 30, 2008 
(g) FIRREA.—Section 1216 of the Financial Institutions 
Reform, Recovery, and Enhancement Act of 1989 (12 U.S.C. 1833e) 
is amended— 
(1) in subsection (a), by striking paragraph (3) and inserting 
the following: 
‘‘(3) the Federal Housing Finance Agency;’’; 
(2) in subsection (b), by striking ‘‘Federal National Mort-
gage Association’’ and inserting ‘‘Federal Home Loan Banks, 
the Federal National Mortgage Association,’’; and 
(3) in subsection (c), by striking ‘‘Finance Board’’ and 
inserting ‘‘Finance Agency’’. 
SEC. 1217. STUDY ON FEDERAL HOME LOAN BANK ADVANCES. 
(a) IN GENERAL.—Not later than 1 year after the date of enact-
ment of this Act, the Director shall conduct a study and submit 
a report to the Committee on Banking, Housing, and Urban Affairs 
of the Senate and the Committee on Financial Services of the 
House or Representatives on the extent to which loans and securi-
ties used as collateral to support Federal Home Loan Bank advances 
are consistent with the interagency guidance on nontraditional 
mortgage products. 
(b) REQUIRED CONTENT.—The study required under subsection 
(a) shall— 
(1) consider and recommend any additional regulations, 
guidance, advisory bulletins, or other administrative actions 
necessary to ensure that the Federal Home Loan Banks are 
not supporting loans with predatory characteristics; and 
(2) include an opportunity for the public to comment on 
any recommendations made under paragraph (1). 
SEC. 1218. FEDERAL HOME LOAN BANK REFINANCING AUTHORITY FOR 
CERTAIN RESIDENTIAL MORTGAGE LOANS. 
Section 10(j)(2) of the Federal Home Loan Bank Act (12 U.S.C. 
1430(j)(2)) is amended— 
(1) in subparagraph (A), by striking ‘‘or’’ at the end; 
(2) in subparagraph (B), by striking the period at the 
end and inserting ‘‘; or’’; and 
(3) by adding at the end the following: 
‘‘(C) during the 2-year period beginning on the date 
of enactment of this subparagraph, use such percentage 
as the Director may by regulation establish of any sub-
sidized advances set aside to finance homeownership under 
subparagraph (A) to refinance loans that are secured by 
a first mortgage on a primary residence of any family 
having an income at or below 80 percent of the median 
income for the area.’’. 
Effective date. 
Public comment. 
Recommenda- 
tions. 
Deadline. 
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122 STAT. 2794 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE III—TRANSFER OF FUNCTIONS, 
PERSONNEL, 
AND 
PROPERTY 
OF 
OFHEO AND THE FEDERAL HOUSING 
FINANCE BOARD 
Subtitle A—OFHEO 
SEC. 1301. ABOLISHMENT OF OFHEO. 
(a) IN GENERAL.—Effective at the end of the 1-year period 
beginning on the date of enactment of this Act, the Office of Federal 
Housing Enterprise Oversight of the Department of Housing and 
Urban Development and the positions of the Director and Deputy 
Director of such Office are abolished. 
(b) DISPOSITION OF AFFAIRS.—During the 1-year period begin-
ning on the date of enactment of this Act, the Director of the 
Office of Federal Housing Enterprise Oversight, solely for the pur-
pose of winding up the affairs of the Office of Federal Housing 
Enterprise Oversight— 
(1) shall manage the employees of such Office and provide 
for the payment of the compensation and benefits of any such 
employee which accrue before the effective date of the transfer 
of such employee under section 1303; and 
(2) may take any other action necessary for the purpose 
of winding up the affairs of the Office. 
(c) STATUS
OF EMPLOYEES BEFORE TRANSFER.—The amend-
ments made by title I and the abolishment of the Office of Federal 
Housing Enterprise Oversight under subsection (a) of this section 
may not be construed to affect the status of any employee of 
such Office as an employee of an agency of the United States 
for purposes of any other provision of law before the effective 
date of the transfer of any such employee under section 1303. 
(d) USE OF PROPERTY AND SERVICES.— 
(1) PROPERTY.—The Director may use the property of the 
Office of Federal Housing Enterprise Oversight to perform func-
tions which have been transferred to the Director for such 
time as is reasonable to facilitate the orderly transfer of func-
tions transferred under any other provision of this Act or any 
amendment made by this Act to any other provision of law. 
(2) AGENCY SERVICES.—Any agency, department, or other 
instrumentality of the United States, and any successor to 
any such agency, department, or instrumentality, which was 
providing supporting services to the Office of Federal Housing 
Enterprise Oversight before the expiration of the period under 
subsection (a) in connection with functions that are transferred 
to the Director shall— 
(A) continue to provide such services, on a reimbursable 
basis, until the transfer of such functions is complete; and 
(B) consult with any such agency to coordinate and 
facilitate a prompt and reasonable transition. 
(e) CONTINUATION OF SERVICES.—The Director may use the 
services of employees and other personnel of the Office of Federal 
Housing Enterprise Oversight, on a reimbursable basis, to perform 
functions which have been transferred to the Director for such 
time as is reasonable to facilitate the orderly transfer of functions 
Effective date. 
Effective date. 
12 USC 4511 
note. 
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122 STAT. 2795 
PUBLIC LAW 110–289—JULY 30, 2008 
pursuant to any other provision of this Act or any amendment 
made by this Act to any other provision of law. 
(f) SAVINGS PROVISIONS.— 
(1) EXISTING
RIGHTS, 
DUTIES, 
AND
OBLIGATIONS
NOT 
AFFECTED.—Subsection (a) shall not affect the validity of any 
right, duty, or obligation of the United States, the Director 
of the Office of Federal Housing Enterprise Oversight, or any 
other person, which— 
(A) arises under— 
(i) the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992; 
(ii) the Federal National Mortgage Association 
Charter Act; 
(iii) the Federal Home Loan Mortgage Corporation 
Act; or 
(iv) any other provision of law applicable with 
respect to such Office; and 
(B) existed on the day before the date of abolishment 
under subsection (a). 
(2) CONTINUATION OF SUITS.—No action or other proceeding 
commenced by or against the Director of the Office of Federal 
Housing Enterprise Oversight in connection with functions that 
are transferred to the Director of the Federal Housing Finance 
Agency shall abate by reason of the enactment of this Act, 
except that the Director of the Federal Housing Finance Agency 
shall be substituted for the Director of the Office of Federal 
Housing Enterprise Oversight as a party to any such action 
or proceeding. 
SEC. 1302. CONTINUATION AND COORDINATION OF CERTAIN ACTIONS. 
(a) IN GENERAL.—All regulations, orders, and determinations 
described in subsection (b) shall remain in effect according to the 
terms of such regulations, orders, and determinations, and shall 
be enforceable by or against the Director or the Secretary of Housing 
and Urban Development, as the case may be, until modified, termi-
nated, set aside, or superseded in accordance with applicable law 
by the Director or the Secretary, as the case may be, any court 
of competent jurisdiction, or operation of law. 
(b) APPLICABILITY.—A regulation, order, or determination is 
described in this subsection if it— 
(1) was issued, made, prescribed, or allowed to become 
effective by— 
(A) the Office of Federal Housing Enterprise Oversight; 
(B) the Secretary of Housing and Urban Development, 
and relates to the authority of the Secretary under— 
(i) the Federal Housing Enterprises Financial 
Safety and Soundness Act of 1992; 
(ii) the Federal National Mortgage Association 
Charter Act, with respect to the Federal National Mort-
gage Association; or 
(iii) the Federal Home Loan Mortgage Corporation 
Act, with respect to the Federal Home Loan Mortgage 
Corporation; or 
(C) a court of competent jurisdiction, and relates to 
functions transferred by this Act; and 
(2) is in effect on the effective date of the abolishment 
under section 1301(a). 
12 USC 4511 
note. 
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122 STAT. 2796 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1303. TRANSFER AND RIGHTS OF EMPLOYEES OF OFHEO. 
(a) TRANSFER.—Each employee of the Office of Federal Housing 
Enterprise Oversight shall be transferred to the Agency for employ-
ment, not later than the effective date of the abolishment under 
section 1301(a), and such transfer shall be deemed a transfer of 
function for purposes of section 3503 of title 5, United States 
Code. 
(b) GUARANTEED POSITIONS.— 
(1) IN GENERAL.—Each employee transferred under sub-
section (a) shall be guaranteed a position with the same status, 
tenure, grade, and pay as that held on the day immediately 
preceding the transfer. 
(2) NO
INVOLUNTARY
SEPARATION
OR
REDUCTION.—An 
employee transferred under subsection (a) holding a permanent 
position on the day immediately preceding the transfer may 
not be involuntarily separated or reduced in grade or compensa-
tion during the 12-month period beginning on the date of 
transfer, except for cause, or, in the case of a temporary 
employee, separated in accordance with the terms of the 
appointment of the employee. 
(c) APPOINTMENT AUTHORITY FOR EXCEPTED AND SENIOR EXECU-
TIVE SERVICE EMPLOYEES.— 
(1) IN GENERAL.—In the case of an employee occupying 
a position in the excepted service or the Senior Executive 
Service, any appointment authority established under law or 
by regulations of the Office of Personnel Management for filling 
such position shall be transferred, subject to paragraph (2). 
(2) DECLINE OF TRANSFER.—The Director may decline a 
transfer of authority under paragraph (1) to the extent that 
such authority relates to— 
(A) a position excepted from the competitive service 
because of its confidential, policymaking, policy-deter-
mining, or policy-advocating character; or 
(B) a noncareer position in the Senior Executive Service 
(within the meaning of section 3132(a)(7) of title 5, United 
States Code). 
(d) REORGANIZATION.—If the Director determines, after the end 
of the 1-year period beginning on the effective date of the abolish-
ment under section 1301(a), that a reorganization of the combined 
workforce is required, that reorganization shall be deemed a major 
reorganization for purposes of affording affected employee retire-
ment under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United 
States Code. 
(e) EMPLOYEE BENEFIT PROGRAMS.— 
(1) IN GENERAL.—Any employee of the Office of Federal 
Housing Enterprise Oversight accepting employment with the 
Agency as a result of a transfer under subsection (a) may 
retain, for 12 months after the date on which such transfer 
occurs, membership in any employee benefit program of the 
Agency or the Office of Federal Housing Enterprise Oversight 
of the Department of Housing and Urban Development, as 
applicable, including insurance, to which such employee belongs 
on the date of the abolishment under section 1301(a), if— 
(A) the employee does not elect to give up the benefit 
or membership in the program; and 
(B) the benefit or program is continued by the Director 
of the Federal Housing Finance Agency. 
Effective date. 
Effective date. 
Deadline. 
12 USC 4511 
note. 
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122 STAT. 2797 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) COST DIFFERENTIAL.— 
(A) IN GENERAL.—The difference in the costs between 
the benefits which would have been provided by the Office 
of Federal Housing Enterprise Oversight and those pro-
vided by this section shall be paid by the Director. 
(B) HEALTH INSURANCE.—If any employee elects to give 
up membership in a health insurance program or the health 
insurance program is not continued by the Director, the 
employee shall be permitted to select an alternate Federal 
health insurance program not later than 30 days after 
the date of such election or notice, without regard to any 
other regularly scheduled open season. 
SEC. 1304. TRANSFER OF PROPERTY AND FACILITIES. 
Upon the effective date of its abolishment under section 1301(a), 
all property of the Office of Federal Housing Enterprise Oversight 
shall transfer to the Agency. 
Subtitle B—Federal Housing Finance 
Board 
SEC. 1311. ABOLISHMENT OF THE FEDERAL HOUSING FINANCE BOARD. 
(a) IN GENERAL.—Effective at the end of the 1-year period 
beginning on the date of enactment of this Act, the Federal Housing 
Finance Board (in this subtitle referred to as the ‘‘Board’’) is abol-
ished. 
(b) DISPOSITION OF AFFAIRS.—During the 1-year period begin-
ning on the date of enactment of this Act, the Board, solely for 
the purpose of winding up the affairs of the Board— 
(1) shall manage the employees of the Board and provide 
for the payment of the compensation and benefits of any such 
employee which accrue before the effective date of the transfer 
of such employee under section 1313; and 
(2) may take any other action necessary for the purpose 
of winding up the affairs of the Board. 
(c) STATUS
OF EMPLOYEES BEFORE TRANSFER.—The amend-
ments made by titles I and II and the abolishment of the Board 
under subsection (a) may not be construed to affect the status 
of any employee of the Board as an employee of an agency of 
the United States for purposes of any other provision of law before 
the effective date of the transfer of any such employee under section 
1313. 
(d) USE OF PROPERTY AND SERVICES.— 
(1) PROPERTY.—The Director may use the property of the 
Board to perform functions which have been transferred to 
the Director, for such time as is reasonable to facilitate the 
orderly transfer of functions transferred under any other provi-
sion of this Act or any amendment made by this Act to any 
other provision of law. 
(2) AGENCY SERVICES.—Any agency, department, or other 
instrumentality of the United States, and any successor to 
any such agency, department, or instrumentality, which was 
providing supporting services to the Board before the expiration 
of the 1-year period under subsection (a) in connection with 
functions that are transferred to the Director shall— 
Deadline. 
Effective date. 
Effective date. 
Termination 
date. 
12 USC 4511 
note. 
12 USC 4511 
note. 
Deadline. 
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122 STAT. 2798 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) continue to provide such services, on a reimbursable 
basis, until the transfer of such functions is complete; and 
(B) consult with any such agency to coordinate and 
facilitate a prompt and reasonable transition. 
(e) CONTINUATION OF SERVICES.—The Director may use the 
services of employees and other personnel of the Board, on a 
reimbursable basis, to perform functions which have been trans-
ferred to the Director for such time as is reasonable to facilitate 
the orderly transfer of functions pursuant to any other provision 
of this Act or any amendment made by this Act to any other 
provision of law. 
(f) SAVINGS PROVISIONS.— 
(1) EXISTING
RIGHTS, 
DUTIES, 
AND
OBLIGATIONS
NOT 
AFFECTED.—Subsection (a) shall not affect the validity of any 
right, duty, or obligation of the United States, a member of 
the Board, or any other person, which— 
(A) arises under the Federal Home Loan Bank Act, 
or any other provision of law applicable with respect to 
the Board; and 
(B) existed on the day before the effective date of 
the abolishment under subsection (a). 
(2) CONTINUATION OF SUITS.—No action or other proceeding 
commenced by or against the Board in connection with functions 
that are transferred under this Act to the Director shall abate 
by reason of the enactment of this Act, except that the Director 
shall be substituted for the Board or any member thereof as 
a party to any such action or proceeding. 
SEC. 1312. CONTINUATION AND COORDINATION OF CERTAIN ACTIONS. 
(a) IN GENERAL.—All regulations, orders, determinations, and 
resolutions described under subsection (b) shall remain in effect 
according to the terms of such regulations, orders, determinations, 
and resolutions, and shall be enforceable by or against the Director 
until modified, terminated, set aside, or superseded in accordance 
with applicable law by the Director, any court of competent jurisdic-
tion, or operation of law. 
(b) APPLICABILITY.—A regulation, order, determination, or reso-
lution is described under this subsection if it— 
(1) was issued, made, prescribed, or allowed to become 
effective by— 
(A) the Board; or 
(B) a court of competent jurisdiction, and relates to 
functions transferred by this Act; and 
(2) is in effect on the effective date of the abolishment 
under section 1311(a). 
SEC. 1313. TRANSFER AND RIGHTS OF EMPLOYEES OF THE FEDERAL 
HOUSING FINANCE BOARD. 
(a) TRANSFER.—Each employee of the Board shall be transferred 
to the Agency for employment, not later than the effective date 
of the abolishment under section 1311(a), and such transfer shall 
be deemed a transfer of function for purposes of section 3503 
of title 5, United States Code. 
(b) GUARANTEED POSITIONS.— 
(1) IN GENERAL.—Each employee transferred under sub-
section (a) shall be guaranteed a position with the same status, 
tenure, grade, and pay as that held on the day immediately 
preceding the transfer. 
Deadline. 
12 USC 4511 
note. 
Regulations. 
Orders. 
12 USC 4511 
note. 
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122 STAT. 2799 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) NO
INVOLUNTARY
SEPARATION
OR
REDUCTION.—An 
employee holding a permanent position on the day immediately 
preceding the transfer may not be involuntarily separated or 
reduced in grade or compensation during the 12-month period 
beginning on the date of transfer, except for cause, or, if the 
employee is a temporary employee, separated in accordance 
with the terms of the appointment of the employee. 
(c) APPOINTMENT AUTHORITY FOR EXCEPTED EMPLOYEES.— 
(1) IN GENERAL.—In the case of an employee occupying 
a position in the excepted service, any appointment authority 
established under law or by regulations of the Office of Per-
sonnel Management for filling such position shall be trans-
ferred, subject to paragraph (2). 
(2) DECLINE OF TRANSFER.—The Director may decline a 
transfer of authority under paragraph (1), to the extent that 
such authority relates to a position excepted from the competi-
tive service because of its confidential, policymaking, policy- 
determining, or policy-advocating character. 
(d) REORGANIZATION.—If the Director determines, after the end 
of the 1-year period beginning on the effective date of the abolish-
ment under section 1311(a), that a reorganization of the combined 
workforce is required, that reorganization shall be deemed a major 
reorganization for purposes of affording affected employee retire-
ment under section 8336(d)(2) or 8414(b)(1)(B) of title 5, United 
States Code. 
(e) EMPLOYEE BENEFIT PROGRAMS.— 
(1) IN
GENERAL.—Any employee of the Board accepting 
employment with the Agency as a result of a transfer under 
subsection (a) may retain, for 12 months after the date on 
which such transfer occurs, membership in any employee ben-
efit program of the Agency or the Board, as applicable, including 
insurance, to which such employee belongs on the effective 
date of the abolishment under section 1311(a) if— 
(A) the employee does not elect to give up the benefit 
or membership in the program; and 
(B) the benefit or program is continued by the Director. 
(2) COST DIFFERENTIAL.— 
(A) IN GENERAL.—The difference in the costs between 
the benefits which would have been provided by the Board 
and those provided by this section shall be paid by the 
Director. 
(B) HEALTH INSURANCE.—If any employee elects to give 
up membership in a health insurance program or the health 
insurance program is not continued by the Director, the 
employee shall be permitted to select an alternate Federal 
health insurance program not later than 30 days after 
the date of such election or notice, without regard to any 
other regularly scheduled open season. 
SEC. 1314. TRANSFER OF PROPERTY AND FACILITIES. 
Upon the effective date of the abolishment under section 
1311(a), all property of the Board shall transfer to the Agency. 
Effective date. 
12 USC 4511 
note. 
Deadline. 
Effective date. 
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122 STAT. 2800 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE IV—HOPE FOR HOMEOWNERS 
SEC. 1401. SHORT TITLE. 
This title may be cited as the ‘‘HOPE for Homeowners Act 
of 2008’’. 
SEC. 1402. ESTABLISHMENT OF HOPE FOR HOMEOWNERS PROGRAM. 
(a) ESTABLISHMENT.—Title II of the National Housing Act (12 
U.S.C. 1707 et seq.) is amended by adding at the end the following: 
‘‘SEC. 257. HOPE FOR HOMEOWNERS PROGRAM. 
‘‘(a) ESTABLISHMENT.—There is established in the Federal 
Housing Administration a HOPE for Homeowners Program. 
‘‘(b) PURPOSE.—The purpose of the HOPE for Homeowners Pro-
gram is— 
‘‘(1) to create an FHA program, participation in which 
is voluntary on the part of homeowners and existing loan 
holders to insure refinanced loans for distressed borrowers to 
support long-term, sustainable homeownership; 
‘‘(2) to allow homeowners to avoid foreclosure by reducing 
the principle balance outstanding, and interest rate charged, 
on their mortgages; 
‘‘(3) to help stabilize and provide confidence in mortgage 
markets by bringing transparency to the value of assets based 
on mortgage assets; 
‘‘(4) to target mortgage assistance under this section to 
homeowners for their principal residence; 
‘‘(5) to enhance the administrative capacity of the FHA 
to carry out its expanded role under the HOPE for Homeowners 
Program; 
‘‘(6) to ensure the HOPE for Homeowners Program remains 
in effect only for as long as is necessary to provide stability 
to the housing market; and 
‘‘(7) to provide servicers of delinquent mortgages with addi-
tional methods and approaches to avoid foreclosure. 
‘‘(c) ESTABLISHMENT
AND
IMPLEMENTATION
OF
PROGRAM 
REQUIREMENTS.— 
‘‘(1) DUTIES
OF
THE
BOARD.—In order to carry out the 
purposes of the HOPE for Homeowners Program, the Board 
shall— 
‘‘(A) establish requirements and standards for the pro-
gram; and 
‘‘(B) prescribe such regulations and provide such guid-
ance as may be necessary or appropriate to implement 
such requirements and standards. 
‘‘(2) DUTIES OF THE SECRETARY.—In carrying out any of 
the program requirements or standards established under para-
graph (1), the Secretary may issue such interim guidance and 
mortgagee letters as the Secretary determines necessary or 
appropriate. 
‘‘(d) INSURANCE OF MORTGAGES.—The Secretary is authorized 
upon application of a mortgagee to make commitments to insure 
or to insure any eligible mortgage that has been refinanced in 
a manner meeting the requirements under subsection (e). 
‘‘(e) REQUIREMENTS OF INSURED MORTGAGES.—To be eligible 
for insurance under this section, a refinanced eligible mortgage 
shall comply with all of the following requirements: 
Regulations. 
Standards. 
12 USC 
1715z–23. 
12 USC 1701 
note. 
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122 STAT. 2801 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) LACK OF CAPACITY TO PAY EXISTING MORTGAGE.— 
‘‘(A) BORROWER CERTIFICATION.— 
‘‘(i) IN GENERAL.—The mortgagor shall provide cer-
tification to the Secretary that the mortgagor has not 
intentionally defaulted on the mortgage or any other 
debt, and has not knowingly, or willfully and with 
actual knowledge, furnished material information 
known to be false for the purpose of obtaining any 
eligible mortgage. 
‘‘(ii) PENALTIES.— 
‘‘(I) FALSE STATEMENT.—Any certification filed 
pursuant to clause (i) shall contain an acknowledg-
ment that any willful false statement made in 
such certification is punishable under section 1001, 
of title 18, United States Code, by fine or imprison-
ment of not more than 5 years, or both. 
‘‘(II) LIABILITY
FOR
REPAYMENT.—The mort-
gagor shall agree in writing that the mortgagor 
shall be liable to repay to the Federal Housing 
Administration 
any 
direct 
financial 
benefit 
achieved from the reduction of indebtedness on 
the existing mortgage or mortgages on the resi-
dence refinanced under this section derived from 
misrepresentations made in the certifications and 
documentation required under this subparagraph, 
subject to the discretion of the Secretary. 
‘‘(B) CURRENT BORROWER DEBT-TO-INCOME RATIO.—As 
of March 1, 2008, the mortgagor shall have had a ratio 
of mortgage debt to income, taking into consideration all 
existing mortgages of that mortgagor at such time, greater 
than 31 percent (or such higher amount as the Board 
determines appropriate). 
‘‘(2) DETERMINATION OF PRINCIPAL OBLIGATION AMOUNT.— 
The principal obligation amount of the refinanced eligible mort-
gage to be insured shall— 
‘‘(A) be determined by the reasonable ability of the 
mortgagor to make his or her mortgage payments, as such 
ability is determined by the Secretary pursuant to section 
203(b)(4) or by any other underwriting standards estab-
lished by the Board; and 
‘‘(B) not exceed 90 percent of the appraised value of 
the property to which such mortgage relates. 
‘‘(3) REQUIRED
WAIVER
OF
PREPAYMENT
PENALTIES
AND 
FEES.—All penalties for prepayment or refinancing of the 
eligible mortgage, and all fees and penalties related to default 
or delinquency on the eligible mortgage, shall be waived or 
forgiven. 
‘‘(4) EXTINGUISHMENT OF SUBORDINATE LIENS.— 
‘‘(A) REQUIRED AGREEMENT.—All holders of outstanding 
mortgage liens on the property to which the eligible mort-
gage relates shall agree to accept the proceeds of the 
insured loan as payment in full of all indebtedness under 
the eligible mortgage, and all encumbrances related to 
such eligible mortgage shall be removed. The Secretary 
may take such actions, subject to standards established 
by the Board under subparagraph (B), as may be necessary 
and appropriate to facilitate coordination and agreement 
Records. 
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122 STAT. 2802 
PUBLIC LAW 110–289—JULY 30, 2008 
between the holders of the existing senior mortgage and 
any existing subordinate mortgages, taking into consider-
ation the subordinate lien status of such subordinate mort-
gages. 
‘‘(B) SHARED APPRECIATION.— 
‘‘(i) IN GENERAL.—The Board shall establish stand-
ards and policies that will allow for the payment to 
the holder of any existing subordinate mortgage of 
a portion of any future appreciation in the property 
secured by such eligible mortgage that is owed to the 
Secretary pursuant to subsection (k). 
‘‘(ii) FACTORS.—In establishing the standards and 
policies required under clause (i), the Board shall take 
into consideration— 
‘‘(I) the status of any subordinate mortgage; 
‘‘(II) the outstanding principal balance of and 
accrued interest on the existing senior mortgage 
and any outstanding subordinate mortgages; 
‘‘(III) the extent to which the current appraised 
value of the property securing a subordinate mort-
gage is less than the outstanding principal balance 
and accrued interest on any other liens that are 
senior to such subordinate mortgage; and 
‘‘(IV) such other factors as the Board deter-
mines to be appropriate. 
‘‘(C) VOLUNTARY PROGRAM.—This paragraph may not 
be construed to require any holder of any existing mortgage 
to participate in the program under this section generally, 
or with respect to any particular loan. 
‘‘(5) TERM OF MORTGAGE.—The refinanced eligible mortgage 
to be insured shall— 
‘‘(A) bear interest at a single rate that is fixed for 
the entire term of the mortgage; and 
‘‘(B) have a maturity of not less than 30 years from 
the date of the beginning of amortization of such refinanced 
eligible mortgage. 
‘‘(6) MAXIMUM
LOAN
AMOUNT.—The principal obligation 
amount of the eligible mortgage to be insured shall not exceed 
132 percent of the dollar amount limitation in effect for 2007 
under section 305(a)(2) of the Federal Home Loan Mortgage 
Corporation Act (12 U.S.C. 1454(a)(2)) for a property of the 
applicable size. 
‘‘(7) PROHIBITION ON SECOND LIENS.—A mortgagor may not 
grant a new second lien on the mortgaged property during 
the first 5 years of the term of the mortgage insured under 
this section, except as the Board determines to be necessary 
to ensure the maintenance of property standards; and provided 
that such new outstanding liens (A) do not reduce the value 
of the Government’s equity in the borrower’s home; and (B) 
when combined with the mortgagor’s existing mortgage indebt-
edness, do not exceed 95 percent of the home’s appraised value 
at the time of the new second lien. 
‘‘(8) APPRAISALS.—Any appraisal conducted in connection 
with a mortgage insured under this section shall— 
‘‘(A) be based on the current value of the property; 
Standards. 
Policies. 
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122 STAT. 2803 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) be conducted in accordance with title XI of the 
Financial Institutions Reform, Recovery, and Enforcement 
Act of 1989 (12 U.S.C. 3331 et seq.); 
‘‘(C) be completed by an appraiser who meets the com-
petency requirements of the Uniform Standards of Profes-
sional Appraisal Practice; 
‘‘(D) be wholly consistent with the appraisal standards, 
practices, and procedures under section 202(e) of this Act 
that apply to all loans insured under this Act; and 
‘‘(E) comply with the requirements of subsection (g) 
of this section (relating to appraisal independence). 
‘‘(9) DOCUMENTATION
AND
VERIFICATION
OF
INCOME.—In 
complying with the FHA underwriting requirements under the 
HOPE for Homeowners Program under this section, the mort-
gagee shall document and verify the income of the mortgagor 
or non-filing status by procuring (A) an income tax return 
transcript of the income tax returns of the mortgagor, or(B) 
a copy of the income tax returns from the Internal Revenue 
Service, for the two most recent years for which the filing 
deadline for such years has passed and by any other method, 
in accordance with procedures and standards that the Board 
shall establish. 
‘‘(10) MORTGAGE
FRAUD.—The mortgagor shall not have 
been convicted under Federal or State law for fraud during 
the 10-year period ending upon the insurance of the mortgage 
under this section. 
‘‘(11) PRIMARY RESIDENCE.—The mortgagor shall provide 
documentation satisfactory in the determination of the Sec-
retary to prove that the residence covered by the mortgage 
to be insured under this section is occupied by the mortgagor 
as the primary residence of the mortgagor, and that such resi-
dence is the only residence in which the mortgagor has any 
present ownership interest. 
‘‘(f) STUDY OF AUCTION OR BULK REFINANCE PROGRAM.— 
‘‘(1) STUDY.—The Board shall conduct a study of the need 
for and efficacy of an auction or bulk refinancing mechanism 
to facilitate refinancing of existing residential mortgages that 
are at risk for foreclosure into mortgages insured under this 
section. The study shall identify and examine various options 
for mechanisms under which lenders and servicers of such 
mortgages may make bids for forward commitments for such 
insurance in an expedited manner. 
‘‘(2) CONTENT.— 
‘‘(A) ANALYSIS.—The study required under paragraph 
(1) shall analyze— 
‘‘(i) the feasibility of establishing a mechanism that 
would facilitate the more rapid refinancing of bor-
rowers at risk of foreclosure into performing mortgages 
insured under this section; 
‘‘(ii) whether such a mechanism would provide an 
effective and efficient mechanism to reduce foreclosures 
on qualified existing mortgages; 
‘‘(iii) whether the use of an auction or bulk 
refinance program is necessary to stabilize the housing 
market and reduce the impact of turmoil in that 
market on the economy of the United States; 
Procedures. 
Standards. 
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122 STAT. 2804 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iv) whether there are other mechanisms or 
authority that would be useful to reduce foreclosure; 
and 
‘‘(v) and any other factors that the Board considers 
relevant. 
‘‘(B) DETERMINATIONS.—To the extent that the Board 
finds that a facility of the type described in subparagraph 
(A) is feasible and useful, the study shall— 
‘‘(i) 
determine 
and 
identify 
any 
additional 
authority or resources needed to establish and operate 
such a mechanism; 
‘‘(ii) determine whether there is a need for addi-
tional authority with respect to the loan underwriting 
criteria established in this section or with respect to 
eligibility of participating borrowers, lenders, or 
holders of liens; 
‘‘(iii) determine whether such underwriting criteria 
should be established on the basis of individual loans, 
in the aggregate, or otherwise to facilitate the goal 
of refinancing borrowers at risk of foreclosure into 
viable loans insured under this section. 
‘‘(3) REPORT.—Not later than the expiration of the 60- 
day period beginning on the date of the enactment of this 
section, the Board shall submit a report regarding the results 
of the study conducted under this subsection to the Committee 
on Financial Services of the House of Representatives and 
the Committee on Banking, Housing, and Urban Affairs of 
the Senate. The report shall include a detailed description 
of the analysis required under paragraph (2)(A) and of the 
determinations made pursuant to paragraph (2)(B), and shall 
include any other findings and recommendations of the Board 
pursuant to the study, including identifying various options 
for mechanisms described in paragraph (1). 
‘‘(g) APPRAISAL INDEPENDENCE.— 
‘‘(1) PROHIBITIONS ON INTERESTED PARTIES IN A REAL ESTATE 
TRANSACTION.—No mortgage lender, mortgage broker, mortgage 
banker, real estate broker, appraisal management company, 
employee of an appraisal management company, nor any other 
person with an interest in a real estate transaction involving 
an appraisal in connection with a mortgage insured under 
this section shall improperly influence, or attempt to improperly 
influence, through coercion, extortion, collusion, compensation, 
instruction, inducement, intimidation, nonpayment for services 
rendered, or bribery, the development, reporting, result, or 
review of a real estate appraisal sought in connection with 
the mortgage. 
‘‘(2) CIVIL
MONETARY
PENALTIES.—The Secretary may 
impose a civil money penalty for any knowing and material 
violation of paragraph (1) under the same terms and conditions 
as are authorized in section 536(a) of this Act. 
‘‘(h) STANDARDS TO PROTECT AGAINST ADVERSE SELECTION.— 
‘‘(1) IN GENERAL.—The Board shall, by rule or order, estab-
lish standards and policies to require the underwriter of the 
insured loan to provide such representations and warranties 
as the Board considers necessary or appropriate to enforce 
compliance with all underwriting and appraisal standards of 
the HOPE for Homeowners Program. 
Regulations. 
Orders. 
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122 STAT. 2805 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) EXCLUSION FOR VIOLATIONS.—The Board shall prohibit 
the Secretary from paying insurance benefits to a mortgagee 
who violates the representations and warranties, as established 
under paragraph (1), or in any case in which a mortgagor 
fails to make the first payment on a refinanced eligible mort-
gage. 
‘‘(3) OTHER
AUTHORITY.—The Board may establish such 
other standards or policies as necessary to protect against 
adverse selection, including requiring loans identified by the 
Secretary as higher risk loans to demonstrate payment perform-
ance for a reasonable period of time prior to being insured 
under the program. 
‘‘(i) PREMIUMS.—For each refinanced eligible mortgage insured 
under this section, the Secretary shall establish and collect— 
‘‘(1) at the time of insurance, a single premium payment 
in an amount equal to 3 percent of the amount of the original 
insured principal obligation of the refinanced eligible mortgage, 
which shall be paid from the proceeds of the mortgage being 
insured under this section, through the reduction of the amount 
of indebtedness that existed on the eligible mortgage prior 
to refinancing; and 
‘‘(2) in addition to the premium required under paragraph 
(1), an annual premium in an amount equal to 1.5 percent 
of the amount of the remaining insured principal balance of 
the mortgage. 
‘‘(j) ORIGINATION FEES AND INTEREST RATE.—The Board shall 
establish— 
‘‘(1) a reasonable limitation on origination fees for 
refinanced eligible mortgages insured under this section; and 
‘‘(2) procedures to ensure that interest rates on such mort-
gages shall be commensurate with market rate interest rates 
on such types of loans. 
‘‘(k) EQUITY AND APPRECIATION.— 
‘‘(1) FIVE-YEAR PHASE-IN FOR EQUITY AS A RESULT OF SALE 
OR REFINANCING.—For each eligible mortgage insured under 
this section, the Secretary and the mortgagor of such mortgage 
shall, upon any sale or disposition of the property to which 
such mortgage relates, or upon the subsequent refinancing 
of such mortgage, be entitled to the following with respect 
to any equity created as a direct result of such sale or refi-
nancing: 
‘‘(A) If such sale or refinancing occurs during the period 
that begins on the date that such mortgage is insured 
and ends 1 year after such date of insurance, the Secretary 
shall be entitled to 100 percent of such equity. 
‘‘(B) If such sale or refinancing occurs during the period 
that begins 1 year after such date of insurance and ends 
2 years after such date of insurance, the Secretary shall 
be entitled to 90 percent of such equity and the mortgagor 
shall be entitled to 10 percent of such equity. 
‘‘(C) If such sale or refinancing occurs during the period 
that begins 2 years after such date of insurance and ends 
3 years after such date of insurance, the Secretary shall 
be entitled to 80 percent of such equity and the mortgagor 
shall be entitled to 20 percent of such equity. 
‘‘(D) If such sale or refinancing occurs during the period 
that begins 3 years after such date of insurance and ends 
Effective dates. 
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122 STAT. 2806 
PUBLIC LAW 110–289—JULY 30, 2008 
4 years after such date of insurance, the Secretary shall 
be entitled to 70 percent of such equity and the mortgagor 
shall be entitled to 30 percent of such equity. 
‘‘(E) If such sale or refinancing occurs during the period 
that begins 4 years after such date of insurance and ends 
5 years after such date of insurance, the Secretary shall 
be entitled to 60 percent of such equity and the mortgagor 
shall be entitled to 40 percent of such equity. 
‘‘(F) If such sale or refinancing occurs during any period 
that begins 5 years after such date of insurance, the Sec-
retary shall be entitled to 50 percent of such equity and 
the mortgagor shall be entitled to 50 percent of such equity. 
‘‘(2) APPRECIATION IN VALUE.—For each eligible mortgage 
insured under this section, the Secretary and the mortgagor 
of such mortgage shall, upon any sale or disposition of the 
property to which such mortgage relates, each be entitled to 
50 percent of any appreciation in value of the appraised value 
of such property that has occurred since the date that such 
mortgage was insured under this section. 
‘‘(l) ESTABLISHMENT OF HOPE FUND.— 
‘‘(1) IN
GENERAL.—There is established in the Federal 
Housing Administration a revolving fund to be known as the 
Home Ownership Preservation Entity Fund, which shall be 
used by the Board for carrying out the mortgage insurance 
obligations under this section. 
‘‘(2) MANAGEMENT OF FUND.—The HOPE Fund shall be 
administered and managed by the Secretary, who shall estab-
lish reasonable and prudent criteria for the management and 
operation of any amounts in the HOPE Fund. 
‘‘(m) LIMITATION ON AGGREGATE INSURANCE AUTHORITY.—The 
aggregate original principal obligation of all mortgages insured 
under this section may not exceed $300,000,000,000. 
‘‘(n) REPORTS BY THE BOARD.—The Board shall submit monthly 
reports to the Congress identifying the progress of the HOPE for 
Homeowners Program, which shall contain the following informa-
tion for each month: 
‘‘(1) The number of new mortgages insured under this 
section, including the location of the properties subject to such 
mortgages by census tract. 
‘‘(2) The aggregate principal obligation of new mortgages 
insured under this section. 
‘‘(3) The average amount by which the principle balance 
outstanding on mortgages insured this section was reduced. 
‘‘(4) The amount of premiums collected for insurance of 
mortgages under this section. 
‘‘(5) The claim and loss rates for mortgages insured under 
this section. 
‘‘(6) Any other information that the Board considers appro-
priate. 
‘‘(o) REQUIRED OUTREACH EFFORTS.—The Secretary shall carry 
out outreach efforts to ensure that homeowners, lenders, and the 
general public are aware of the opportunities for assistance avail-
able under this section. 
‘‘(p) ENHANCEMENT OF FHA CAPACITY.—Under the direction 
of the Board, the Secretary shall take such actions as may be 
necessary to— 
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122 STAT. 2807 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(1) contract for the establishment of underwriting criteria, 
automated underwriting systems, pricing standards, and other 
factors relating to eligibility for mortgages insured under this 
section; 
‘‘(2) contract for independent quality reviews of under-
writing, including appraisal reviews and fraud detection, of 
mortgages insured under this section or pools of such mort-
gages; and 
‘‘(3) increase personnel of the Department as necessary 
to process or monitor the processing of mortgages insured under 
this section. 
‘‘(q) GNMA COMMITMENT AUTHORITY.— 
‘‘(1) GUARANTEES.—The Secretary shall take such actions 
as may be necessary to ensure that securities based on and 
backed by a trust or pool composed of mortgages insured under 
this section are available to be guaranteed by the Government 
National Mortgage Association as to the timely payment of 
principal and interest. 
‘‘(2) GUARANTEE AUTHORITY.—To carry out the purposes 
of section 306 of the National Housing Act (12 U.S.C. 1721), 
the Government National Mortgage Association may enter into 
new commitments to issue guarantees of securities based on 
or backed by mortgages insured under this section, not 
exceeding $300,000,000,000. The amount of authority provided 
under the preceding sentence to enter into new commitments 
to issue guarantees is in addition to any amount of authority 
to make new commitments to issue guarantees that is provided 
to the Association under any other provision of law. 
‘‘(r) SUNSET.—The Secretary may not enter into any new 
commitment to insure any refinanced eligible mortgage, or newly 
insure any refinanced eligible mortgage pursuant to this section 
before October 1, 2008 or after September 30, 2011. 
‘‘(s) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply: 
‘‘(1) APPROVED FINANCIAL INSTITUTION OR MORTGAGEE.— 
The term ‘approved financial institution or mortgagee’ means 
a financial institution or mortgagee approved by the Secretary 
under section 203 as responsible and able to service mortgages 
responsibly. 
‘‘(2) BOARD.—The term ‘Board’ means the Board of Direc-
tors of the HOPE for Homeowners Program. The Board shall 
be composed of the Secretary, the Secretary of the Treasury, 
the Chairperson of the Board of Governors of the Federal 
Reserve System, and the Chairperson of the Board of Directors 
of the Federal Deposit Insurance Corporation, or their des-
ignees. 
‘‘(3) ELIGIBLE
MORTGAGE.—The term ‘eligible mortgage’ 
means a mortgage— 
‘‘(A) the mortgagor of which— 
‘‘(i) occupies such property as his or her principal 
residence; and 
‘‘(ii) cannot, subject to subsection (e)(1)(B) and such 
other standards established by the Board, afford his 
or her mortgage payments; and 
‘‘(B) originated on or before January 1, 2008. 
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122 STAT. 2808 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(4) EXISTING SENIOR MORTGAGE.—The term ‘existing senior 
mortgage’ means, with respect to a mortgage insured under 
this section, the existing mortgage that has superior priority. 
‘‘(5) EXISTING SUBORDINATE MORTGAGE.—The term ‘existing 
subordinate mortgage’ means, with respect to a mortgage 
insured under this section, an existing mortgage that has 
subordinate priority to the existing senior mortgage. 
‘‘(6) HOPE FOR HOMEOWNERS PROGRAM.—The term ‘HOPE 
for Homeowners Program’ means the program established 
under this section. 
‘‘(7) SECRETARY.—The term ‘Secretary’ means the Secretary 
of Housing and Urban Development, except where specifically 
provided otherwise. 
‘‘(t) REQUIREMENTS RELATED TO THE BOARD.— 
‘‘(1) COMPENSATION, ACTUAL, NECESSARY, AND TRANSPOR-
TATION EXPENSES.— 
‘‘(A) FEDERAL EMPLOYEES.—A member of the Board 
who is an officer or employee of the Federal Government 
shall serve without additional pay (or benefits in the nature 
of compensation) for service as a member of the Board. 
‘‘(B) TRAVEL EXPENSES.—Members of the Board shall 
be entitled to receive travel expenses, including per diem 
in lieu of subsistence, equivalent to those set forth in 
subchapter I of chapter 57 of title 5, United States Code. 
‘‘(2) BYLAWS.—The Board may prescribe, amend, and repeal 
such bylaws as may be necessary for carrying out the functions 
of the Board. 
‘‘(3) QUORUM.—A majority of the Board shall constitute 
a quorum. 
‘‘(4) STAFF; EXPERTS AND CONSULTANTS.— 
‘‘(A) 
DETAIL
OF
GOVERNMENT
EMPLOYEES.—Upon 
request of the Board, any Federal Government employee 
may be detailed to the Board without reimbursement, and 
such detail shall be without interruption or loss of civil 
service status or privilege. 
‘‘(B) EXPERTS AND CONSULTANTS.—The Board shall pro-
cure the services of experts and consultants as the Board 
considers appropriate. 
‘‘(u) RULE OF CONSTRUCTION RELATED TO VOLUNTARY NATURE 
OF THE PROGRAM.—This section shall not be construed to require 
that any approved financial institution or mortgagee participate 
in any activity authorized under this section, including any activity 
related to the refinancing of an eligible mortgage. 
‘‘(v) RULE OF CONSTRUCTION RELATED TO INSURANCE OF MORT-
GAGES.—Except as otherwise provided for in this section or by 
action of the Board, the provisions and requirements of section 
203(b) shall apply with respect to the insurance of any eligible 
mortgage under this section. 
‘‘(w) HOPE BONDS.— 
‘‘(1) ISSUANCE
AND
REPAYMENT
OF
BONDS.—Notwith-
standing section 504(b) of the Federal Credit Reform Act of 
1990 (2 U.S.C. 661d(b)), the Secretary of the Treasury shall— 
‘‘(A) subject to such terms and conditions as the Sec-
retary of the Treasury deems necessary, issue Federal 
credit instruments, to be known as ‘HOPE Bonds’, that 
are callable at the discretion of the Secretary of the 
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122 STAT. 2809 
PUBLIC LAW 110–289—JULY 30, 2008 
Treasury and do not, in the aggregate, exceed the amount 
specified in subsection (m); 
‘‘(B) provide the subsidy amounts necessary for loan 
guarantees under the HOPE for Homeowners Program, 
not to exceed the amount specified in subsection (m), in 
accordance with the provisions of the Federal Credit Reform 
Act of 1990 (2 U.S.C. 661 et seq.), except as provided 
in this paragraph; and 
‘‘(C) use the proceeds from HOPE Bonds only to pay 
for the net costs to the Federal Government of the HOPE 
for Homeowners Program, including administrative costs. 
‘‘(2) REIMBURSEMENTS
TO
TREASURY.—Funds received 
pursuant to section 1338(b) of the Federal Housing Enterprises 
Regulatory Reform Act of 1992 shall be used to reimburse 
the Secretary of the Treasury for amounts borrowed under 
paragraph (1). 
‘‘(3) USE OF RESERVE FUND.—If the net cost to the Federal 
Government for the HOPE for Homeowners Program exceeds 
the amount of funds received under paragraph (2), remaining 
debts of the HOPE for Homeowners Program shall be paid 
from amounts deposited into the fund established by the Sec-
retary under section 1337(e) of the Federal Housing Enterprises 
Financial Safety and Soundness Act of 1992, remaining 
amounts in such fund to be used to reduce the National debt. 
‘‘(4) REDUCTION
OF
NATIONAL
DEBT.—Amounts collected 
under the HOPE for Homeowners Program in accordance with 
subsections (i) and (k) in excess of the net cost to the Federal 
Government for such Program shall be used to reduce the 
National debt.’’. 
SEC. 1403. FIDUCIARY DUTY OF SERVICERS OF POOLED RESIDENTIAL 
MORTGAGE LOANS. 
The Truth in Lending Act (15 U.S.C. 1601 et seq.) is amended 
by inserting after section 129 the following new section: 
‘‘SEC. 129A. FIDUCIARY DUTY OF SERVICERS OF POOLED RESIDENTIAL 
MORTGAGES. 
‘‘(a) IN GENERAL.—Except as may be established in any invest-
ment contract between a servicer of pooled residential mortgages 
and an investor, a servicer of pooled residential mortgages— 
‘‘(1) owes any duty to maximize the net present value 
of the pooled mortgages in an investment to all investors and 
parties having a direct or indirect interest in such investment, 
not to any individual party or group of parties; and 
‘‘(2) shall be deemed to act in the best interests of all 
such investors and parties if the servicer agrees to or imple-
ments a modification or workout plan, including any modifica-
tion or refinancing undertaken pursuant to the HOPE for 
Homeowners Act of 2008, for a residential mortgage or a class 
of residential mortgages that constitute a part or all of the 
pooled mortgages in such investment, provided that any mort-
gage so modified meets the following criteria: 
‘‘(A) Default on the payment of such mortgage has 
occurred or is reasonably foreseeable. 
‘‘(B) The property securing such mortgage is occupied 
by the mortgagor of such mortgage. 
‘‘(C) The anticipated recovery on the principal out-
standing obligation of the mortgage under the modification 
15 USC 1639a. 
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122 STAT. 2810 
PUBLIC LAW 110–289—JULY 30, 2008 
or workout plan exceeds, on a net present value basis, 
the anticipated recovery on the principal outstanding 
obligation of the mortgage through foreclosure. 
‘‘(b) DEFINITION.—As used in this section, the term ‘servicer’ 
means the person responsible for servicing of a loan (including 
the person who makes or holds a loan if such person also services 
the loan).’’. 
SEC. 1404. REVISED STANDARDS FOR FHA APPRAISERS. 
Section 202(e) of the National Housing Act (12 U.S.C. 1708(e)) 
is amended by adding at the end the following: 
‘‘(5) ADDITIONAL APPRAISER STANDARDS.—Beginning on the 
date of enactment of the Federal Housing Finance Regulatory 
Reform Act of 2008, any appraiser chosen or approved to con-
duct appraisals for mortgages under this title shall— 
‘‘(A) be certified— 
‘‘(i) by the State in which the property to be 
appraised is located; or 
‘‘(ii) by a nationally recognized professional 
appraisal organization; and 
‘‘(B) have demonstrated verifiable education in the 
appraisal requirements established by the Federal Housing 
Administration under this subsection.’’. 
TITLE V—S.A.F.E. MORTGAGE 
LICENSING ACT 
SEC. 1501. SHORT TITLE. 
This title may be cited as the ‘‘Secure and Fair Enforcement 
for Mortgage Licensing Act of 2008’’ or ‘‘S.A.F.E. Mortgage Licensing 
Act of 2008’’. 
SEC. 1502. PURPOSES AND METHODS FOR ESTABLISHING A MORTGAGE 
LICENSING SYSTEM AND REGISTRY. 
In order to increase uniformity, reduce regulatory burden, 
enhance consumer protection, and reduce fraud, the States, through 
the Conference of State Bank Supervisors and the American 
Association of Residential Mortgage Regulators, are hereby encour-
aged to establish a Nationwide Mortgage Licensing System and 
Registry for the residential mortgage industry that accomplishes 
all of the following objectives: 
(1) Provides uniform license applications and reporting 
requirements for State-licensed loan originators. 
(2) Provides a comprehensive licensing and supervisory 
database. 
(3) Aggregates and improves the flow of information to 
and between regulators. 
(4) Provides increased accountability and tracking of loan 
originators. 
(5) Streamlines the licensing process and reduces the regu-
latory burden. 
(6) Enhances consumer protections and supports anti-fraud 
measures. 
(7) Provides consumers with easily accessible information, 
offered at no charge, utilizing electronic media, including the 
Internet, regarding the employment history of, and publicly 
State and local 
governments. 
12 USC 5101 
note. 
Secure and Fair 
Enforcement for 
Mortgage 
Licensing Act of 
2008. 
12 USC 5101 
note. 
Certification. 
Effective date. 
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122 STAT. 2811 
PUBLIC LAW 110–289—JULY 30, 2008 
adjudicated disciplinary and enforcement actions against, loan 
originators. 
(8) Establishes a means by which residential mortgage 
loan originators would, to the greatest extent possible, be 
required to act in the best interests of the consumer. 
(9) Facilitates responsible behavior in the subprime mort-
gage market place and provides comprehensive training and 
examination requirements related to subprime mortgage 
lending. 
(10) Facilitates the collection and disbursement of consumer 
complaints on behalf of State and Federal mortgage regulators. 
SEC. 1503. DEFINITIONS. 
For purposes of this title, the following definitions shall apply: 
(1) FEDERAL
BANKING
AGENCIES.—The term ‘‘Federal 
banking agencies’’ means the Board of Governors of the Federal 
Reserve System, the Comptroller of the Currency, the Director 
of the Office of Thrift Supervision, the National Credit Union 
Administration, and the Federal Deposit Insurance Corpora-
tion. 
(2) DEPOSITORY INSTITUTION.—The term ‘‘depository institu-
tion’’ has the same meaning as in section 3 of the Federal 
Deposit Insurance Act, and includes any credit union. 
(3) LOAN ORIGINATOR.— 
(A) IN GENERAL.—The term ‘‘loan originator’’— 
(i) means an individual who— 
(I) takes a residential mortgage loan applica-
tion; and 
(II) offers or negotiates terms of a residential 
mortgage loan for compensation or gain; 
(ii) does not include any individual who is not 
otherwise described in clause (i) and who performs 
purely administrative or clerical tasks on behalf of 
a person who is described in any such clause; 
(iii) does not include a person or entity that only 
performs real estate brokerage activities and is licensed 
or registered in accordance with applicable State law, 
unless the person or entity is compensated by a lender, 
a mortgage broker, or other loan originator or by any 
agent of such lender, mortgage broker, or other loan 
originator; and 
(iv) does not include a person or entity solely 
involved in extensions of credit relating to timeshare 
plans, as that term is defined in section 101(53D) 
of title 11, United States Code. 
(B) OTHER
DEFINITIONS
RELATING
TO
LOAN
ORIGI-
NATOR.—For purposes of this subsection, an individual 
‘‘assists a consumer in obtaining or applying to obtain 
a residential mortgage loan’’ by, among other things, 
advising on loan terms (including rates, fees, other costs), 
preparing loan packages, or collecting information on behalf 
of the consumer with regard to a residential mortgage 
loan. 
(C) ADMINISTRATIVE
OR
CLERICAL
TASKS.—The term 
‘‘administrative or clerical tasks’’ means the receipt, collec-
tion, and distribution of information common for the proc-
essing or underwriting of a loan in the mortgage industry 
12 USC 5102. 
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122 STAT. 2812 
PUBLIC LAW 110–289—JULY 30, 2008 
and communication with a consumer to obtain information 
necessary for the processing or underwriting of a residential 
mortgage loan. 
(D) REAL ESTATE BROKERAGE ACTIVITY DEFINED.—The 
term ‘‘real estate brokerage activity’’ means any activity 
that involves offering or providing real estate brokerage 
services to the public, including— 
(i) acting as a real estate agent or real estate 
broker for a buyer, seller, lessor, or lessee of real 
property; 
(ii) bringing together parties interested in the sale, 
purchase, lease, rental, or exchange of real property; 
(iii) negotiating, on behalf of any party, any portion 
of a contract relating to the sale, purchase, lease, 
rental, or exchange of real property (other than in 
connection with providing financing with respect to 
any such transaction); 
(iv) engaging in any activity for which a person 
engaged in the activity is required to be registered 
or licensed as a real estate agent or real estate broker 
under any applicable law; and 
(v) offering to engage in any activity, or act in 
any capacity, described in clause (i), (ii), (iii), or (iv). 
(4) LOAN PROCESSOR OR UNDERWRITER.— 
(A) IN GENERAL.—The term ‘‘loan processor or under-
writer’’ means an individual who performs clerical or sup-
port duties at the direction of and subject to the supervision 
and instruction of— 
(i) a State-licensed loan originator; or 
(ii) a registered loan originator. 
(B) CLERICAL
OR
SUPPORT
DUTIES.—For purposes of 
subparagraph (A), the term ‘‘clerical or support duties’’ 
may include— 
(i) the receipt, collection, distribution, and analysis 
of information common for the processing or under-
writing of a residential mortgage loan; and 
(ii) communicating with a consumer to obtain the 
information necessary for the processing or under-
writing of a loan, to the extent that such communica-
tion does not include offering or negotiating loan rates 
or terms, or counseling consumers about residential 
mortgage loan rates or terms. 
(5) NATIONWIDE MORTGAGE LICENSING SYSTEM AND REG-
ISTRY.—The term ‘‘Nationwide Mortgage Licensing System and 
Registry’’ means a mortgage licensing system developed and 
maintained by the Conference of State Bank Supervisors and 
the American Association of Residential Mortgage Regulators 
for the State licensing and registration of State-licensed loan 
originators and the registration of registered loan originators 
or any system established by the Secretary under section 1509. 
(6) NONTRADITIONAL MORTGAGE PRODUCT.—The term ‘‘non-
traditional mortgage product’’ means any mortgage product 
other than a 30-year fixed rate mortgage. 
(7) REGISTERED LOAN ORIGINATOR.—The term ‘‘registered 
loan originator’’ means any individual who— 
(A) meets the definition of loan originator and is an 
employee of— 
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122 STAT. 2813 
PUBLIC LAW 110–289—JULY 30, 2008 
(i) a depository institution; 
(ii) a subsidiary that is— 
(I) owned and controlled by a depository 
institution; and 
(II) regulated by a Federal banking agency; 
or 
(iii) an institution regulated by the Farm Credit 
Administration; and 
(B) is registered with, and maintains a unique identi-
fier through, the Nationwide Mortgage Licensing System 
and Registry. 
(8) RESIDENTIAL MORTGAGE LOAN.—The term ‘‘residential 
mortgage loan’’ means any loan primarily for personal, family, 
or household use that is secured by a mortgage, deed of trust, 
or other equivalent consensual security interest on a dwelling 
(as defined in section 103(v) of the Truth in Lending Act) 
or residential real estate upon which is constructed or intended 
to be constructed a dwelling (as so defined). 
(9) SECRETARY.—The term ‘‘Secretary’’ means the Secretary 
of Housing and Urban Development. 
(10) STATE.—The term ‘‘State’’ means any State of the 
United States, the District of Columbia, any territory of the 
United States, Puerto Rico, Guam, American Samoa, the Trust 
Territory of the Pacific Islands, the Virgin Islands, and the 
Northern Mariana Islands. 
(11) STATE-LICENSED LOAN ORIGINATOR.—The term ‘‘State- 
licensed loan originator’’ means any individual who— 
(A) is a loan originator; 
(B) is not an employee of— 
(i) a depository institution; 
(ii) a subsidiary that is— 
(I) owned and controlled by a depository 
institution; and 
(II) regulated by a Federal banking agency; 
or 
(iii) an institution regulated by the Farm Credit 
Administration; and 
(C) is licensed by a State or by the Secretary under 
section 1508 and registered as a loan originator with, and 
maintains a unique identifier through, the Nationwide 
Mortgage Licensing System and Registry. 
(12) UNIQUE IDENTIFIER.— 
(A) IN GENERAL.—The term ‘‘unique identifier’’ means 
a number or other identifier that— 
(i) permanently identifies a loan originator; 
(ii) is assigned by protocols established by the 
Nationwide Mortgage Licensing System and Registry 
and the Federal banking agencies to facilitate elec-
tronic tracking of loan originators and uniform identi-
fication of, and public access to, the employment his-
tory of and the publicly adjudicated disciplinary and 
enforcement actions against loan originators; and 
(iii) shall not be used for purposes other than 
those set forth under this title. 
(B) RESPONSIBILITY OF STATES.—To the greatest extent 
possible and to accomplish the purpose of this title, States 
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122 STAT. 2814 
PUBLIC LAW 110–289—JULY 30, 2008 
shall use unique identifiers in lieu of social security num-
bers. 
SEC. 1504. LICENSE OR REGISTRATION REQUIRED. 
(a) IN GENERAL.—Subject to the existence of a licensing or 
registration regime, as the case may be, an individual may not 
engage in the business of a loan originator without first— 
(1) obtaining, and maintaining annually— 
(A) a registration as a registered loan originator; or 
(B) a license and registration as a State-licensed loan 
originator; and 
(2) obtaining a unique identifier. 
(b) LOAN PROCESSORS AND UNDERWRITERS.— 
(1) SUPERVISED LOAN PROCESSORS AND UNDERWRITERS.— 
A loan processor or underwriter who does not represent to 
the public, through advertising or other means of commu-
nicating or providing information (including the use of business 
cards, stationery, brochures, signs, rate lists, or other pro-
motional items), that such individual can or will perform any 
of the activities of a loan originator shall not be required 
to be a State-licensed loan originator. 
(2) INDEPENDENT
CONTRACTORS.—An independent con-
tractor may not engage in residential mortgage loan origination 
activities as a loan processor or underwriter unless such inde-
pendent contractor is a State-licensed loan originator. 
SEC. 1505. STATE LICENSE AND REGISTRATION APPLICATION AND 
ISSUANCE. 
(a) BACKGROUND CHECKS.—In connection with an application 
to any State for licensing and registration as a State-licensed loan 
originator, the applicant shall, at a minimum, furnish to the Nation-
wide Mortgage Licensing System and Registry information con-
cerning the applicant’s identity, including— 
(1) fingerprints for submission to the Federal Bureau of 
Investigation, and any governmental agency or entity author-
ized to receive such information for a State and national 
criminal history background check; and 
(2) personal history and experience, including authorization 
for the System to obtain— 
(A) an independent credit report obtained from a con-
sumer reporting agency described in section 603(p) of the 
Fair Credit Reporting Act; and 
(B) information related to any administrative, civil or 
criminal findings by any governmental jurisdiction. 
(b) ISSUANCE
OF
LICENSE.—The minimum standards for 
licensing and registration as a State-licensed loan originator shall 
include the following: 
(1) The applicant has never had a loan originator license 
revoked in any governmental jurisdiction. 
(2) The applicant has not been convicted of, or pled guilty 
or nolo contendere to, a felony in a domestic, foreign, or military 
court— 
(A) during the 7-year period preceding the date of 
the application for licensing and registration; or 
(B) at any time preceding such date of application, 
if such felony involved an act of fraud, dishonesty, or a 
breach of trust, or money laundering. 
12 USC 5104. 
12 USC 5103. 
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122 STAT. 2815 
PUBLIC LAW 110–289—JULY 30, 2008 
(3) The applicant has demonstrated financial responsibility, 
character, and general fitness such as to command the con-
fidence of the community and to warrant a determination that 
the loan originator will operate honestly, fairly, and efficiently 
within the purposes of this title. 
(4) The applicant has completed the pre-licensing education 
requirement described in subsection (c). 
(5) The applicant has passed a written test that meets 
the test requirement described in subsection (d). 
(6) The applicant has met either a net worth or surety 
bond requirement, or paid into a State fund, as required by 
the State pursuant to section 1508(d)(6). 
(c) PRE-LICENSING EDUCATION OF LOAN ORIGINATORS.— 
(1) MINIMUM
EDUCATIONAL
REQUIREMENTS.—In order to 
meet the pre-licensing education requirement referred to in 
subsection (b)(4), a person shall complete at least 20 hours 
of education approved in accordance with paragraph (2), which 
shall include at least— 
(A) 3 hours of Federal law and regulations; 
(B) 3 hours of ethics, which shall include instruction 
on fraud, consumer protection, and fair lending issues; 
and 
(C) 2 hours of training related to lending standards 
for the nontraditional mortgage product marketplace. 
(2) APPROVED
EDUCATIONAL
COURSES.—For purposes of 
paragraph (1), pre-licensing education courses shall be 
reviewed, and approved by the Nationwide Mortgage Licensing 
System and Registry. 
(3) LIMITATION AND STANDARDS.— 
(A) LIMITATION.—To maintain the independence of the 
approval process, the Nationwide Mortgage Licensing 
System and Registry shall not directly or indirectly offer 
pre-licensure educational courses for loan originators. 
(B) STANDARDS.—In approving courses under this sec-
tion, the Nationwide Mortgage Licensing System and Reg-
istry shall apply reasonable standards in the review and 
approval of courses. 
(d) TESTING OF LOAN ORIGINATORS.— 
(1) IN GENERAL.—In order to meet the written test require-
ment referred to in subsection (b)(5), an individual shall pass, 
in accordance with the standards established under this sub-
section, a qualified written test developed by the Nationwide 
Mortgage Licensing System and Registry and administered by 
an approved test provider. 
(2) QUALIFIED TEST.—A written test shall not be treated 
as a qualified written test for purposes of paragraph (1) unless 
the test adequately measures the applicant’s knowledge and 
comprehension in appropriate subject areas, including— 
(A) ethics; 
(B) Federal law and regulation pertaining to mortgage 
origination; 
(C) State law and regulation pertaining to mortgage 
origination; 
(D) Federal and State law and regulation, including 
instruction on fraud, consumer protection, the nontradi-
tional mortgage marketplace, and fair lending issues. 
(3) MINIMUM COMPETENCE.— 
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122 STAT. 2816 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) PASSING SCORE.—An individual shall not be consid-
ered to have passed a qualified written test unless the 
individual achieves a test score of not less than 75 percent 
correct answers to questions. 
(B) INITIAL RETESTS.—An individual may retake a test 
3 consecutive times with each consecutive taking occurring 
at least 30 days after the preceding test. 
(C) SUBSEQUENT RETESTS.—After failing 3 consecutive 
tests, an individual shall wait at least 6 months before 
taking the test again. 
(D) RETEST AFTER LAPSE OF LICENSE.—A State-licensed 
loan originator who fails to maintain a valid license for 
a period of 5 years or longer shall retake the test, not 
taking into account any time during which such individual 
is a registered loan originator. 
(e) MORTGAGE CALL REPORTS.—Each mortgage licensee shall 
submit to the Nationwide Mortgage Licensing System and Registry 
reports of condition, which shall be in such form and shall contain 
such information as the Nationwide Mortgage Licensing System 
and Registry may require. 
SEC. 1506. STANDARDS FOR STATE LICENSE RENEWAL. 
(a) IN GENERAL.—The minimum standards for license renewal 
for State-licensed loan originators shall include the following: 
(1) The loan originator continues to meet the minimum 
standards for license issuance. 
(2) The loan originator has satisfied the annual continuing 
education requirements described in subsection (b). 
(b) CONTINUING EDUCATION FOR STATE-LICENSED LOAN ORIGI-
NATORS.— 
(1) IN GENERAL.—In order to meet the annual continuing 
education requirements referred to in subsection (a)(2), a State- 
licensed loan originator shall complete at least 8 hours of 
education approved in accordance with paragraph (2), which 
shall include at least— 
(A) 3 hours of Federal law and regulations; 
(B) 2 hours of ethics, which shall include instruction 
on fraud, consumer protection, and fair lending issues; 
and 
(C) 2 hours of training related to lending standards 
for the nontraditional mortgage product marketplace. 
(2) APPROVED
EDUCATIONAL
COURSES.—For purposes of 
paragraph (1), continuing education courses shall be reviewed, 
and approved by the Nationwide Mortgage Licensing System 
and Registry. 
(3) CALCULATION OF CONTINUING EDUCATION CREDITS.—A 
State-licensed loan originator— 
(A) may only receive credit for a continuing education 
course in the year in which the course is taken; and 
(B) may not take the same approved course in the 
same or successive years to meet the annual requirements 
for continuing education. 
(4) INSTRUCTOR CREDIT.—A State-licensed loan originator 
who is approved as an instructor of an approved continuing 
education course may receive credit for the originator’s own 
annual continuing education requirement at the rate of 2 hours 
credit for every 1 hour taught. 
12 USC 5105. 
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122 STAT. 2817 
PUBLIC LAW 110–289—JULY 30, 2008 
(5) LIMITATION AND STANDARDS.— 
(A) LIMITATION.—To maintain the independence of the 
approval process, the Nationwide Mortgage Licensing 
System and Registry shall not directly or indirectly offer 
any continuing education courses for loan originators. 
(B) STANDARDS.—In approving courses under this sec-
tion, the Nationwide Mortgage Licensing System and Reg-
istry shall apply reasonable standards in the review and 
approval of courses. 
SEC. 1507. SYSTEM OF REGISTRATION ADMINISTRATION BY FEDERAL 
AGENCIES. 
(a) DEVELOPMENT.— 
(1) IN
GENERAL.—The Federal banking agencies shall 
jointly, through the Federal Financial Institutions Examination 
Council, and together with the Farm Credit Administration, 
develop and maintain a system for registering employees of 
a depository institution, employees of a subsidiary that is owned 
and controlled by a depository institution and regulated by 
a Federal banking agency, or employees of an institution regu-
lated by the Farm Credit Administration, as registered loan 
originators with the Nationwide Mortgage Licensing System 
and Registry. The system shall be implemented before the 
end of the 1-year period beginning on the date of enactment 
of this title. 
(2) REGISTRATION REQUIREMENTS.—In connection with the 
registration of any loan originator under this subsection, the 
appropriate Federal banking agency and the Farm Credit 
Administration shall, at a minimum, furnish or cause to be 
furnished to the Nationwide Mortgage Licensing System and 
Registry information concerning the employees’s identity, 
including— 
(A) fingerprints for submission to the Federal Bureau 
of Investigation, and any governmental agency or entity 
authorized to receive such information for a State and 
national criminal history background check; and 
(B) 
personal 
history 
and 
experience, 
including 
authorization for the Nationwide Mortgage Licensing 
System and Registry to obtain information related to any 
administrative, civil or criminal findings by any govern-
mental jurisdiction. 
(b) COORDINATION.— 
(1) UNIQUE
IDENTIFIER.—The Federal banking agencies, 
through the Financial Institutions Examination Council, and 
the Farm Credit Administration shall coordinate with the 
Nationwide Mortgage Licensing System and Registry to estab-
lish protocols for assigning a unique identifier to each registered 
loan originator that will facilitate electronic tracking and uni-
form identification of, and public access to, the employment 
history of and publicly adjudicated disciplinary and enforcement 
actions against loan originators. 
(2) NATIONWIDE MORTGAGE LICENSING SYSTEM AND REG-
ISTRY DEVELOPMENT.—To facilitate the transfer of information 
required by subsection (a)(2), the Nationwide Mortgage 
Licensing System and Registry shall coordinate with the Fed-
eral banking agencies, through the Financial Institutions 
Public 
information. 
Deadline. 
12 USC 5106. 
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122 STAT. 2818 
PUBLIC LAW 110–289—JULY 30, 2008 
Examination Council, and the Farm Credit Administration con-
cerning the development and operation, by such System and 
Registry, of the registration functionality and data require-
ments for loan originators. 
(c) CONSIDERATION OF FACTORS AND PROCEDURES.—In estab-
lishing the registration procedures under subsection (a) and the 
protocols for assigning a unique identifier to a registered loan 
originator, the Federal banking agencies shall make such de 
minimis exceptions as may be appropriate to paragraphs (1)(A) 
and (2) of section 1504(a), shall make reasonable efforts to utilize 
existing information to minimize the burden of registering loan 
originators, and shall consider methods for automating the process 
to the greatest extent practicable consistent with the purposes 
of this title. 
SEC. 1508. SECRETARY OF HOUSING AND URBAN DEVELOPMENT 
BACKUP AUTHORITY TO ESTABLISH A LOAN ORIGINATOR 
LICENSING SYSTEM. 
(a) BACKUP LICENSING SYSTEM.—If, by the end of the 1-year 
period, or the 2-year period in the case of a State whose legislature 
meets only biennially, beginning on the date of the enactment 
of this title or at any time thereafter, the Secretary determines 
that a State does not have in place by law or regulation a system 
for licensing and registering loan originators that meets the require-
ments of sections 1505 and 1506 and subsection (d) of this section, 
or does not participate in the Nationwide Mortgage Licensing 
System and Registry, the Secretary shall provide for the establish-
ment and maintenance of a system for the licensing and registration 
by the Secretary of loan originators operating in such State as 
State-licensed loan originators. 
(b) LICENSING AND REGISTRATION REQUIREMENTS.—The system 
established by the Secretary under subsection (a) for any State 
shall meet the requirements of sections 1505 and 1506 for State- 
licensed loan originators. 
(c) UNIQUE IDENTIFIER.—The Secretary shall coordinate with 
the Nationwide Mortgage Licensing System and Registry to estab-
lish protocols for assigning a unique identifier to each loan origi-
nator licensed by the Secretary as a State-licensed loan originator 
that will facilitate electronic tracking and uniform identification 
of, and public access to, the employment history of and the publicly 
adjudicated disciplinary and enforcement actions against loan origi-
nators. 
(d) STATE LICENSING LAW REQUIREMENTS.—For purposes of 
this section, the law in effect in a State meets the requirements 
of this subsection if the Secretary determines the law satisfies 
the following minimum requirements: 
(1) A State loan originator supervisory authority is main-
tained to provide effective supervision and enforcement of such 
law, including the suspension, termination, or nonrenewal of 
a license for a violation of State or Federal law. 
(2) The State loan originator supervisory authority ensures 
that all State-licensed loan originators operating in the State 
are registered with Nationwide Mortgage Licensing System 
and Registry. 
(3) The State loan originator supervisory authority is 
required to regularly report violations of such law, as well 
Reports. 
Public 
infomation. 
State and local 
governments. 
Deadlines. 
12 USC 5107. 
Information 
technology. 
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122 STAT. 2819 
PUBLIC LAW 110–289—JULY 30, 2008 
as enforcement actions and other relevant information, to the 
Nationwide Mortgage Licensing System and Registry. 
(4) The State loan originator supervisory authority has 
a process in place for challenging information contained in 
the Nationwide Mortgage Licensing System and Registry. 
(5) The State loan originator supervisory authority has 
established a mechanism to assess civil money penalties for 
individuals acting as mortgage originators in their State with-
out a valid license or registration. 
(6) The State loan originator supervisory authority has 
established minimum net worth or surety bonding requirements 
that reflect the dollar amount of loans originated by a residen-
tial mortgage loan originator, or has established a recovery 
fund paid into by the loan originators. 
(e) TEMPORARY EXTENSION
OF PERIOD.—The Secretary may 
extend, by not more than 24 months, the 1-year or 2-year period, 
as the case may be, referred to in subsection (a) for the licensing 
of loan originators in any State under a State licensing law that 
meets the requirements of sections 1505 and 1506 and subsection 
(d) if the Secretary determines that such State is making a good 
faith effort to establish a State licensing law that meets such 
requirements, license mortgage originators under such law, and 
register such originators with the Nationwide Mortgage Licensing 
System and Registry. 
SEC. 1509. BACKUP AUTHORITY TO ESTABLISH A NATIONWIDE MORT-
GAGE LICENSING AND REGISTRY SYSTEM. 
If at any time the Secretary determines that the Nationwide 
Mortgage Licensing System and Registry is failing to meet the 
requirements and purposes of this title for a comprehensive 
licensing, supervisory, and tracking system for loan originators, 
the Secretary shall establish and maintain such a system to carry 
out the purposes of this title and the effective registration and 
regulation of loan originators. 
SEC. 1510. FEES. 
The Federal banking agencies, the Farm Credit Administration, 
the Secretary, and the Nationwide Mortgage Licensing System and 
Registry may charge reasonable fees to cover the costs of 
maintaining and providing access to information from the Nation-
wide Mortgage Licensing System and Registry, to the extent that 
such fees are not charged to consumers for access to such system 
and registry. 
SEC. 1511. BACKGROUND CHECKS OF LOAN ORIGINATORS. 
(a) ACCESS TO RECORDS.—Notwithstanding any other provision 
of law, in providing identification and processing functions, the 
Attorney General shall provide access to all criminal history 
information to the appropriate State officials responsible for regu-
lating State-licensed loan originators to the extent criminal history 
background checks are required under the laws of the State for 
the licensing of such loan originators. 
(b) AGENT.—For the purposes of this section and in order to 
reduce the points of contact which the Federal Bureau of Investiga-
tion may have to maintain for purposes of subsection (a), the 
Conference of State Bank Supervisors or a wholly owned subsidiary 
may be used as a channeling agent of the States for requesting 
12 USC 5110. 
12 USC 5109. 
12 USC 5108. 
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122 STAT. 2820 
PUBLIC LAW 110–289—JULY 30, 2008 
and distributing information between the Department of Justice 
and the appropriate State agencies. 
SEC. 1512. CONFIDENTIALITY OF INFORMATION. 
(a) SYSTEM CONFIDENTIALITY.—Except as otherwise provided 
in this section, any requirement under Federal or State law 
regarding the privacy or confidentiality of any information or mate-
rial provided to the Nationwide Mortgage Licensing System and 
Registry or a system established by the Secretary under section 
1509, and any privilege arising under Federal or State law 
(including the rules of any Federal or State court) with respect 
to such information or material, shall continue to apply to such 
information or material after the information or material has been 
disclosed to the system. Such information and material may be 
shared with all State and Federal regulatory officials with mortgage 
industry oversight authority without the loss of privilege or the 
loss of confidentiality protections provided by Federal and State 
laws. 
(b) NONAPPLICABILITY OF CERTAIN REQUIREMENTS.—Informa-
tion or material that is subject to a privilege or confidentiality 
under subsection (a) shall not be subject to— 
(1) disclosure under any Federal or State law governing 
the disclosure to the public of information held by an officer 
or an agency of the Federal Government or the respective 
State; or 
(2) subpoena or discovery, or admission into evidence, in 
any private civil action or administrative process, unless with 
respect to any privilege held by the Nationwide Mortgage 
Licensing System and Registry or the Secretary with respect 
to such information or material, the person to whom such 
information or material pertains waives, in whole or in part, 
in the discretion of such person, that privilege. 
(c) COORDINATION WITH OTHER LAW.—Any State law, including 
any State open record law, relating to the disclosure of confidential 
supervisory information or any information or material described 
in subsection (a) that is inconsistent with subsection (a) shall be 
superseded by the requirements of such provision to the extent 
State law provides less confidentiality or a weaker privilege. 
(d) PUBLIC ACCESS TO INFORMATION.—This section shall not 
apply with respect to the information or material relating to the 
employment history of, and publicly adjudicated disciplinary and 
enforcement actions against, loan originators that is included in 
Nationwide Mortgage Licensing System and Registry for access 
by the public. 
SEC. 1513. LIABILITY PROVISIONS. 
The Secretary, any State official or agency, any Federal banking 
agency, or any organization serving as the administrator of the 
Nationwide Mortgage Licensing System and Registry or a system 
established by the Secretary under section 1509, or any officer 
or employee of any such entity, shall not be subject to any civil 
action or proceeding for monetary damages by reason of the good 
faith action or omission of any officer or employee of any such 
entity, while acting within the scope of office or employment, 
relating to the collection, furnishing, or dissemination of information 
concerning persons who are loan originators or are applying for 
licensing or registration as loan originators. 
12 USC 5112. 
Applicability. 
12 USC 5111. 
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122 STAT. 2821 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1514. ENFORCEMENT UNDER HUD BACKUP LICENSING SYSTEM. 
(a) SUMMONS AUTHORITY.—The Secretary may— 
(1) examine any books, papers, records, or other data of 
any loan originator operating in any State which is subject 
to a licensing system established by the Secretary under section 
1508; and 
(2) summon any loan originator referred to in paragraph 
(1) or any person having possession, custody, or care of the 
reports and records relating to such loan originator, to appear 
before the Secretary or any delegate of the Secretary at a 
time and place named in the summons and to produce such 
books, papers, records, or other data, and to give testimony, 
under oath, as may be relevant or material to an investigation 
of such loan originator for compliance with the requirements 
of this title. 
(b) EXAMINATION AUTHORITY.— 
(1) IN GENERAL.—If the Secretary establishes a licensing 
system under section 1508 for any State, the Secretary shall 
appoint examiners for the purposes of administering such sec-
tion. 
(2) POWER TO EXAMINE.—Any examiner appointed under 
paragraph (1) shall have power, on behalf of the Secretary, 
to make any examination of any loan originator operating in 
any State which is subject to a licensing system established 
by the Secretary under section 1508 whenever the Secretary 
determines an examination of any loan originator is necessary 
to determine the compliance by the originator with this title. 
(3) REPORT
OF
EXAMINATION.—Each examiner appointed 
under paragraph (1) shall make a full and detailed report 
of examination of any loan originator examined to the Secretary. 
(4) ADMINISTRATION
OF
OATHS
AND
AFFIRMATIONS; EVI-
DENCE.—In connection with examinations of loan originators 
operating in any State which is subject to a licensing system 
established by the Secretary under section 1508, or with other 
types of investigations to determine compliance with applicable 
law and regulations, the Secretary and examiners appointed 
by the Secretary may administer oaths and affirmations and 
examine and take and preserve testimony under oath as to 
any matter in respect to the affairs of any such loan originator. 
(5) ASSESSMENTS.—The cost of conducting any examination 
of any loan originator operating in any State which is subject 
to a licensing system established by the Secretary under section 
1508 shall be assessed by the Secretary against the loan origi-
nator to meet the Secretary’s expenses in carrying out such 
examination. 
(c) CEASE AND DESIST PROCEEDING.— 
(1) AUTHORITY OF SECRETARY.—If the Secretary finds, after 
notice and opportunity for hearing, that any person is violating, 
has violated, or is about to violate any provision of this title, 
or any regulation thereunder, with respect to a State which 
is subject to a licensing system established by the Secretary 
under section 1508, the Secretary may publish such findings 
and enter an order requiring such person, and any other person 
that is, was, or would be a cause of the violation, due to 
an act or omission the person knew or should have known 
would contribute to such violation, to cease and desist from 
committing or causing such violation and any future violation 
12 USC 5113. 
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122 STAT. 2822 
PUBLIC LAW 110–289—JULY 30, 2008 
of the same provision, rule, or regulation. Such order may, 
in addition to requiring a person to cease and desist from 
committing or causing a violation, require such person to 
comply, or to take steps to effect compliance, with such provi-
sion or regulation, upon such terms and conditions and within 
such time as the Secretary may specify in such order. Any 
such order may, as the Secretary deems appropriate, require 
future compliance or steps to effect future compliance, either 
permanently or for such period of time as the Secretary may 
specify, with such provision or regulation with respect to any 
loan originator. 
(2) HEARING.—The notice instituting proceedings pursuant 
to paragraph (1) shall fix a hearing date not earlier than 
30 days nor later than 60 days after service of the notice 
unless an earlier or a later date is set by the Secretary with 
the consent of any respondent so served. 
(3) TEMPORARY
ORDER.—Whenever the Secretary deter-
mines that the alleged violation or threatened violation speci-
fied in the notice instituting proceedings pursuant to paragraph 
(1), or the continuation thereof, is likely to result in significant 
dissipation or conversion of assets, significant harm to con-
sumers, or substantial harm to the public interest prior to 
the completion of the proceedings, the Secretary may enter 
a temporary order requiring the respondent to cease and desist 
from the violation or threatened violation and to take such 
action to prevent the violation or threatened violation and 
to prevent dissipation or conversion of assets, significant harm 
to consumers, or substantial harm to the public interest as 
the Secretary deems appropriate pending completion of such 
proceedings. Such an order shall be entered only after notice 
and opportunity for a hearing, unless the Secretary determines 
that notice and hearing prior to entry would be impracticable 
or contrary to the public interest. A temporary order shall 
become effective upon service upon the respondent and, unless 
set aside, limited, or suspended by the Secretary or a court 
of competent jurisdiction, shall remain effective and enforceable 
pending the completion of the proceedings. 
(4) REVIEW OF TEMPORARY ORDERS.— 
(A) REVIEW
BY
SECRETARY.—At any time after the 
respondent has been served with a temporary cease and 
desist order pursuant to paragraph (3), the respondent 
may apply to the Secretary to have the order set aside, 
limited, or suspended. If the respondent has been served 
with a temporary cease and desist order entered without 
a prior hearing before the Secretary, the respondent may, 
within 10 days after the date on which the order was 
served, request a hearing on such application and the Sec-
retary shall hold a hearing and render a decision on such 
application at the earliest possible time. 
(B) JUDICIAL REVIEW.—Within— 
(i) 10 days after the date the respondent was 
served with a temporary cease and desist order entered 
with a prior hearing before the Secretary; or 
(ii) 10 days after the Secretary renders a decision 
on an application and hearing under paragraph (1), 
with respect to any temporary cease and desist order 
entered without a prior hearing before the Secretary, 
Effective date. 
Notification. 
Deadline. 
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122 STAT. 2823 
PUBLIC LAW 110–289—JULY 30, 2008 
the respondent may apply to the United States district 
court for the district in which the respondent resides or 
has its principal place of business, or for the District of 
Columbia, for an order setting aside, limiting, or sus-
pending the effectiveness or enforcement of the order, and 
the court shall have jurisdiction to enter such an order. 
A respondent served with a temporary cease and desist 
order entered without a prior hearing before the Secretary 
may not apply to the court except after hearing and decision 
by the Secretary on the respondent’s application under 
subparagraph (A). 
(C) NO AUTOMATIC STAY OF TEMPORARY ORDER.—The 
commencement of proceedings under subparagraph (B) 
shall not, unless specifically ordered by the court, operate 
as a stay of the Secretary’s order. 
(5) AUTHORITY OF THE SECRETARY TO PROHIBIT PERSONS 
FROM SERVING AS LOAN ORIGINATORS.—In any cease and desist 
proceeding under paragraph (1), the Secretary may issue an 
order to prohibit, conditionally or unconditionally, and perma-
nently or for such period of time as the Secretary shall deter-
mine, any person who has violated this title or regulations 
thereunder, from acting as a loan originator if the conduct 
of that person demonstrates unfitness to serve as a loan origi-
nator. 
(d) AUTHORITY
OF
THE SECRETARY TO ASSESS MONEY PEN-
ALTIES.— 
(1) IN GENERAL.—The Secretary may impose a civil penalty 
on a loan originator operating in any State which is subject 
to a licensing system established by the Secretary under section 
1508, if the Secretary finds, on the record after notice and 
opportunity for hearing, that such loan originator has violated 
or failed to comply with any requirement of this title or any 
regulation prescribed by the Secretary under this title or order 
issued under subsection (c). 
(2) MAXIMUM AMOUNT OF PENALTY.—The maximum amount 
of penalty for each act or omission described in paragraph 
(1) shall be $25,000. 
SEC. 1515. STATE EXAMINATION AUTHORITY. 
In addition to any authority allowed under State law a State 
licensing agency shall have the authority to conduct investigations 
and examinations as follows: 
(1) For the purposes of investigating violations or com-
plaints arising under this title, or for the purposes of examina-
tion, the State licensing agency may review, investigate, or 
examine any loan originator licensed or required to be licensed 
under this title, as often as necessary in order to carry out 
the purposes of this title. 
(2) Each such loan originator shall make available upon 
request to the State licensing agency the books and records 
relating to the operations of such originator. The State licensing 
agency may have access to such books and records and inter-
view the officers, principals, loan originators, employees, inde-
pendent contractors, agents, and customers of the licensee con-
cerning their business. 
(3) The authority of this section shall remain in effect, 
whether such a loan originator acts or claims to act under 
Records. 
12 USC 5114. 
Notification. 
Hearings. 
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122 STAT. 2824 
PUBLIC LAW 110–289—JULY 30, 2008 
any licensing or registration law of such State, or claims to 
act without such authority. 
(4) No person subject to investigation or examination under 
this section may knowingly withhold, abstract, remove, muti-
late, destroy, or secrete any books, records, computer records, 
or other information. 
SEC. 1516. REPORTS AND RECOMMENDATIONS TO CONGRESS. 
(a) ANNUAL REPORTS.—Not later than 1 year after the date 
of enactment of this title, and annually thereafter, the Secretary 
shall submit a report to Congress on the effectiveness of the provi-
sions of this title, including legislative recommendations, if any, 
for strengthening consumer protections, enhancing examination 
standards, streamlining communication between all stakeholders 
involved in residential mortgage loan origination and processing, 
and establishing performance based bonding requirements for mort-
gage originators or institutions that employ such brokers. 
(b) LEGISLATIVE RECOMMENDATIONS.—Not later than 6 months 
after the date of enactment of this title, the Secretary shall make 
recommendations to Congress on legislative reforms to the Real 
Estate Settlement Procedures Act of 1974, that the Secretary deems 
appropriate to promote more transparent disclosures, allowing con-
sumers to better shop and compare mortgage loan terms and settle-
ment costs. 
SEC. 1517. STUDY AND REPORTS ON DEFAULTS AND FORECLOSURES. 
(a) STUDY REQUIRED.—The Secretary shall conduct an extensive 
study of the root causes of default and foreclosure of home loans, 
using as much empirical data as is available. 
(b) PRELIMINARY REPORT
TO CONGRESS.—Not later than 6 
months after the date of enactment of this title, the Secretary 
shall submit to Congress a preliminary report regarding the study 
required by this section. 
(c) FINAL REPORT TO CONGRESS.—Not later than 12 months 
after the date of enactment of this title, the Secretary shall submit 
to Congress a final report regarding the results of the study required 
by this section, which shall include any recommended legislation 
relating to the study, and recommendations for best practices and 
for a process to provide targeted assistance to populations with 
the highest risk of potential default or foreclosure. 
TITLE VI—MISCELLANEOUS 
SEC. 1601. STUDY AND REPORTS ON GUARANTEE FEES. 
(a) ONGOING STUDY OF FEES.—The Director shall conduct an 
ongoing study of fees charged by enterprises for guaranteeing a 
mortgage. 
(b) COLLECTION OF DATA.—The Director shall, by regulation 
or order, establish procedures for the collection of data from enter-
prises for purposes of this subsection, including the format and 
the process for collection of such data. 
(c) REPORTS TO CONGRESS.—The Director shall annually submit 
a report to Congress on the results of the study conducted under 
subsection (a), based on the aggregated data collected under sub-
section (a) for the subject year, regarding the amount of such 
fees and the criteria used by the enterprises to determine such 
fees. 
Regulations. 
Orders. 
Procedures. 
Deadline. 
12 USC 4514a. 
Deadline. 
Deadline. 
12 USC 5116. 
Deadline. 
12 USC 5115. 
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122 STAT. 2825 
PUBLIC LAW 110–289—JULY 30, 2008 
(d) CONTENTS OF REPORTS.—The reports required under sub-
section (c) shall identify and analyze— 
(1) the factors considered in determining the amount of 
the guarantee fees charged; 
(2) the total revenue earned by the enterprises from guar-
antee fees; 
(3) the total costs incurred by the enterprises for providing 
guarantees; 
(4) the average guarantee fee charged by the enterprises; 
(5) an analysis of any increase or decrease in guarantee 
fees from the preceding year; 
(6) a breakdown of the revenue and costs associated with 
providing guarantees, based on product type and risk classifica-
tions; and 
(7) a breakdown of guarantee fees charged based on asset 
size of the originator and the number of loans sold or trans-
ferred to an enterprise. 
(e) PROTECTION OF INFORMATION.—Nothing in this section may 
be construed to require or authorize the Director to publicly disclose 
information that is confidential or proprietary. 
SEC. 1602. STUDY AND REPORT ON DEFAULT RISK EVALUATION. 
(a) STUDY.—The Director shall conduct a study of ways to 
improve the overall default risk evaluation used with respect to 
residential mortgage loans. Particular attention shall be paid to 
the development and utilization of processes and technologies that 
provide a means to standardize the measurement of risk. 
(b) REPORT.—The Director shall submit a report on the study 
conducted under this section to the Committee on Banking, 
Housing, and Urban Affairs of the Senate and the Committee 
on Financial Services of the House of Representatives, not later 
than 1 year after the date of enactment of this Act. 
SEC. 1603. CONVERSION OF HUD CONTRACTS. 
(a) IN GENERAL.—Notwithstanding any other provision of law, 
the Secretary may, at the request of an owner of a multifamily 
housing project that exceeds 5,000 units to which a contract for 
project-based rental assistance under section 8 of the United States 
Housing Act of 1937 (‘‘Act’’) (42 U.S.C. 1437f) and a Rental Assist-
ance Payment contract is subject, convert such contracts to a con-
tract for project-based rental assistance under section 8 of the 
Act. 
(b) INITIAL RENEWAL.— 
(1) At the request of an owner under subsection (a) made 
no later than 90 days prior to a conversion, the Secretary 
may, to the extent sufficient amounts are made available in 
appropriation Acts and notwithstanding any other law, treat 
the contemplated resulting contract as if such contract were 
eligible for initial renewal under section 524(a) of the Multi-
Family Assisted Housing Reform and Affordability Act of 1997 
(42 U.S.C. 1437f note) (‘‘MAHRA’’) (42 U.S.C. 1437f note). 
(2) A request by an owner pursuant to paragraph (1) shall 
be upon such terms and conditions as the Secretary may 
require. 
(c) RESULTING CONTRACT.—The resulting contract shall— 
(1) be subject to section 524(a) of MAHRA (42 U.S.C. 1437f 
note); 
42 USC 1437f 
note. 
Deadline. 
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122 STAT. 2826 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) be considered for all purposes a contract that has been 
renewed under section 524(a) of MAHRA (42 U.S.C. 1437f 
note) for a term not to exceed 20 years; 
(3) be subsequently renewable at the request of an owner, 
under any renewal option for which the project is eligible under 
MAHRA (42 U.S.C. 1437f note); 
(4) contain provisions limiting distributions, as the Sec-
retary determines appropriate, not to exceed 10 percent of 
the initial investment of the owner; 
(5) be subject to the availability of sufficient amounts in 
appropriation Acts; and 
(6) be subject to such other terms and conditions as the 
Secretary considers appropriate. 
(d) INCOME TARGETING.—To the extent that assisted dwelling 
units, subject to the resulting contract under subsection (a), serve 
low-income families, as defined in section 3(b)(2) of the Act (42 
U.S.C. 1437a(b)(2)) the units shall be considered to be in compliance 
with all income targeting requirements under the Act (42 U.S.C. 
1437 et seq). 
(e) TENANT ELIGIBILITY.—Notwithstanding any other provision 
of law, each family residing in an assisted dwelling unit on the 
date of conversion of a contract under this section, subject to the 
resulting contract under subsection (a), shall be considered to meet 
the applicable requirements for income eligibility and occupancy. 
(f) DEFINITIONS.—As used in this section— 
(1) the term ‘‘Secretary’’ means the Secretary of Housing 
and Urban Development; 
(2) the term ‘‘conversion’’ means the action under which 
a contract for project-based rental assistance under section 
8 of the Act and a Rental Assistance Payment contract become 
a contract for project-based rental assistance under section 
8 of the Act (42 U.S.C. 1437f) pursuant to subsection (a); 
(3) the term ‘‘resulting contract’’ means the new contract 
after a conversion pursuant to subsection (a); and 
(4) the term ‘‘assisted dwelling unit’’ means a dwelling 
unit in a multifamily housing project that exceeds 5,000 units 
that, on the date of conversion of a contract under this section, 
is subject to a contract for project-based rental assistance under 
section 8 of the Act (42 U.S.C. 1437f) or a Rental Assistance 
Payment contract. 
SEC. 1604. BRIDGE DEPOSITORY INSTITUTIONS. 
(a) IN GENERAL.—Section 11 of the Federal Deposit Insurance 
Act (12 U.S.C. 1821) is amended— 
(1) in subsection (d)(2)— 
(A) in subparagraph (F), by striking ‘‘as receiver’’ and 
all that follows through clause (ii) and inserting the fol-
lowing: ‘‘as receiver, with respect to any insured depository 
institution, organize a new depository institution under 
subsection (m) or a bridge depository institution under 
subsection (n).’’; 
(B) in subparagraph (G), by striking ‘‘new bank or 
a bridge bank’’ and inserting ‘‘new depository institution 
or a bridge depository institution’’; 
(2) in the heading for subsection (e)(10)(C), by striking 
‘‘BRIDGE BANKS’’ and inserting ‘‘BRIDGE DEPOSITORY INSTITU-
TIONS’’; 
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122 STAT. 2827 
PUBLIC LAW 110–289—JULY 30, 2008 
(3) in subsection (e)(10)(C)(i), by striking ‘‘bridge bank’’ 
and inserting ‘‘bridge depository institution’’; 
(4) in subsection (m)— 
(A) in the subsection heading, by striking ‘‘BANKS’’ 
and inserting ‘‘DEPOSITORY INSTITUTIONS’’; 
(B) by striking ‘‘insured bank’’ each place such term 
appears and inserting ‘‘insured depository institution’’; 
(C) by striking ‘‘new bank’’ each place such term 
appears and inserting ‘‘new depository institution’’; 
(D) by striking ‘‘such bank’’ each place such term 
appears and inserting ‘‘such depository institution’’; 
(E) by striking ‘‘the bank’’ each place such term appears 
and inserting ‘‘the insured depository institution’’; 
(F) in paragraph (1), by inserting ‘‘or Federal savings 
association’’ after ‘‘national bank’’; 
(G) in paragraph (6), by striking ‘‘only bank’’ and 
inserting ‘‘only depository institution’’; 
(H) in paragraph (9), by inserting ‘‘or the Director 
of the Office of Thrift Supervision, as appropriate’’ after 
‘‘Comptroller of the Currency’’; 
(I) in paragraph (15), by striking ‘‘, but in no event’’ 
and all that follows through ‘‘located’’; 
(J) in paragraph (16)— 
(i) by inserting ‘‘or the Director of the Office of 
Thrift Supervision, as appropriate,’’ after ‘‘Comptroller 
of the Currency’’ each place such term appears; 
(ii) by striking ‘‘the bank’’ each place such term 
appears and inserting ‘‘the depository institution’’; 
(iii) by inserting ‘‘or Federal savings association’’ 
after ‘‘national bank’’ each place such term appears; 
(iv) by inserting ‘‘or Federal savings associations’’ 
after ‘‘national banks’’; and 
(v) by striking ‘‘Such bank’’ and inserting ‘‘Such 
depository institution’’; and 
(K) in paragraph (18), by inserting ‘‘or the Director 
of the Office of Thrift Supervision, as appropriate,’’ after 
‘‘Comptroller of the Currency’’ each place such term 
appears; 
(5) in subsection (n)— 
(A) in the subsection heading, by striking ‘‘BANKS’’ 
and inserting ‘‘DEPOSITORY INSTITUTIONS’’; 
(B) by striking ‘‘bridge bank’’ each place such term 
appears and inserting ‘‘bridge depository institution’’; 
(C) by striking ‘‘bridge banks’’ each place such term 
appears (other than in paragraph (1)(A))and inserting 
‘‘bridge depository institutions’’; 
(D) by striking ‘‘bridge bank’s’’ each place such term 
appears and inserting ‘‘bridge depository institution’s’’; 
(E) by striking ‘‘insured bank’’ each place such term 
appears and inserting ‘‘insured depository institution’’; 
(F) by striking ‘‘insured banks’’ each place such term 
appears and inserting ‘‘insured depository institutions’’; 
(G) by striking ‘‘such bank’’ each place such term 
appears (other than in paragraph (4)(J)) and inserting 
‘‘such depository institution’’; 
(H) by striking ‘‘the bank’’ each place such term 
appears and inserting ‘‘the depository institution’’; 
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122 STAT. 2828 
PUBLIC LAW 110–289—JULY 30, 2008 
(I) by striking ‘‘bank or banks’’ each place such term 
appears and inserting ‘‘depository institution or institu-
tions’’; 
(J) in paragraph (1)(A)— 
(i) by inserting ‘‘, with respect to 1 or more insured 
banks, or the Director of the Office of Thrift Super-
vision, with respect to 1 or more insured savings 
associations,’’ after ‘‘Comptroller of the Currency’’; 
(ii) by inserting ‘‘or Federal savings associations, 
as appropriate,’’ after ‘‘national banks’’; 
(iii) by inserting ‘‘or Federal savings associations, 
as applicable,’’ after ‘‘banking associations’’; and 
(iv) by striking ‘‘as bridge banks’’ and inserting 
‘‘as ‘bridge depository institutions’ ’’; 
(K) in paragraph (1)(B)— 
(i) by striking ‘‘of a bank’’; and 
(ii) by striking ‘‘of that bank’’; 
(L) in the heading for paragraph (1)(E), by inserting 
‘‘OR FEDERAL SAVINGS ASSOCIATION’’ before the period; 
(M) in paragraph (1)(E), by inserting before the period 
‘‘, in the case of 1 or more insured banks, and as a Federal 
savings association, in the case of 1 or more insured savings 
associations’’; 
(N) in paragraph (2)— 
(i) by inserting ‘‘or Federal savings association’’ 
after ‘‘national bank’’ each place such term appears; 
(ii) in subparagraph (A), by inserting ‘‘or the 
Director of the Office of Thrift Supervision’’ after 
‘‘Comptroller of the Currency’’; and 
(iii) in the heading for subparagraph (B), by 
inserting ‘‘OR
FEDERAL
SAVINGS
ASSOCIATION’’ before 
the period; 
(O) in paragraph (4)— 
(i) in the matter preceding subparagraph (A), by 
inserting ‘‘or Federal savings association, as appro-
priate’’ after ‘‘national bank’’; 
(ii) in subparagraph (C), by striking ‘‘under section 
5138 of the Revised Statutes or any other’’ and 
inserting ‘‘under any’’; 
(iii) by inserting ‘‘and the Director of the Office 
of Thrift Supervision, as appropriate,’’ after ‘‘Comp-
troller of the Currency’’ each place such term appears; 
(iv) in subparagraph (D), by striking ‘‘bank’s’’ and 
inserting ‘‘depository institution’s’’; and 
(v) in subparagraph (H), by striking ‘‘a bank in 
default’’ and inserting ‘‘a depository institution in 
default’’; 
(P) in paragraph (8)— 
(i) in subparagraph (A), by striking ‘‘the banks’’ 
and inserting ‘‘the depository institutions’’; 
(ii) in subparagraph (B), by striking ‘‘bank’s’’ and 
inserting ‘‘depository institution’s’’; 
(Q) by striking ‘‘BRIDGE BANK’’ or ‘‘BRIDGE BANKS’’ as 
the case may be in the headings for paragraphs (9), (10), 
(12), and (13) and inserting ‘‘BRIDGE DEPOSITORY INSTITU-
TION’’ or ‘‘BRIDGE DEPOSITORY INSTITUTIONS’’ as appropriate; 
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122 STAT. 2829 
PUBLIC LAW 110–289—JULY 30, 2008 
(R) in paragraph (11), by inserting ‘‘or a Federal 
savings association, as the case may be,’’ after ‘‘national 
bank’’ each place such term appears; 
(S) in paragraph (12)— 
(i) by inserting ‘‘or the Director of the Office of 
Thrift Supervision, as appropriate,’’ after ‘‘Comptroller 
of the Currency’’ each place such term appears; and 
(ii) by inserting ‘‘or Federal savings associations, 
as appropriate’’ after ‘‘national banks’’; and 
(T) in paragraph (13), by striking ‘‘single bank’’ and 
inserting ‘‘single depository institution’’. 
(b) OTHER CONFORMING AMENDMENTS.— 
(1) FEDERAL DEPOSIT INSURANCE ACT.—The Federal Deposit 
Insurance Act (12 U.S.C. 1811 et seq.) is amended— 
(A) in section 3 (12 U.S.C. 1813), by striking subsection 
(i) and inserting the following: 
‘‘(i) NEW DEPOSITORY INSTITUTION
AND BRIDGE DEPOSITORY 
INSTITUTION DEFINED.— 
‘‘(1) NEW DEPOSITORY INSTITUTION.—The term ‘new deposi-
tory institution’ means a new national bank or Federal savings 
association, other than a bridge depository institution, orga-
nized by the Corporation in accordance with section 11(m). 
‘‘(2) BRIDGE
DEPOSITORY
INSTITUTION.—The term ‘bridge 
depository institution’ means a new national bank or Federal 
savings association organized by the Corporation in accordance 
with section 11(n).’’; 
(B) in section 10(d)(5)(B) (12 U.S.C. 1820(d)(5)(B)), by 
striking ‘‘bridge bank’’ and inserting ‘‘bridge depository 
institution’’; 
(C) in section 12 (12 U.S.C. 1822), by striking ‘‘new 
bank’’ each place such term appears and inserting ‘‘new 
depository institution’’;and 
(D) in section 38(j)(2) (12 U.S.C. 1831o(j)(2)), by striking 
‘‘bridge bank’’ and inserting ‘‘bridge depository institution’’. 
(2) FEDERAL CREDIT UNION ACT.—Section 207(c)(10)(C)(i) 
of the Federal Credit Union Act (12 U.S.C. 1787(c)(10)(C)(i)) 
is amended by striking ‘‘bridge bank’’ and inserting ‘‘bridge 
depository institution’’. 
(3) TITLE 11, UNITED STATES CODE.—Section 783 of title 
11, United States Code, is amended by striking ‘‘bridge bank’’ 
and inserting ‘‘bridge depository institution’’. 
(4) TITLE
26, UNITED
STATES
CODE.—Section 414(l)(2)(G) 
of the Internal Revenue Code of 1986, is amended by striking 
‘‘bridge bank’’ and inserting ‘‘bridge depository institution’’. 
(c) REPEAL OF DEPOSIT LIMITATION.—Section 11(n)(1)(B)(i) of 
the Federal Deposit Insurance Act (12 U.S.C. 1821(n)(1)(B)(i)) is 
amended by striking ‘‘, except that’’ and all that follows through 
‘‘another insured depository institution’’. 
(d) FEDERAL RESERVE BANK LENDING TO BRIDGE DEPOSITORY 
INSTITUTIONS.—Section 11(n)(5) of the Federal Deposit Insurance 
Act (12 U.S.C. 1821(n)(5)) is amended by adding at the end the 
following new subparagraph: 
‘‘(D) CAPITAL LEVELS.—A bridge depository institution 
shall not be considered an undercapitalized depository 
institution or a critically undercapitalized depository 
institution for purposes of section 10B(b) of the Federal 
Reserve Act.’’. 
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122 STAT. 2830 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 1605. SENSE OF THE SENATE. 
It is the sense of the Senate that in implementing or carrying 
out any provision of this Act, or any amendment made by this 
Act, the Senate supports a policy of noninterference regarding local 
government requirements that the holder of a foreclosed property 
maintain that property. 
DIVISION B—FORECLOSURE 
PREVENTION 
SEC. 2001. SHORT TITLE. 
This division may be cited as the ‘‘Foreclosure Prevention Act 
of 2008’’. 
SEC. 2002. EMERGENCY DESIGNATION. 
For purposes of Senate enforcement, all provisions of this divi-
sion are designated as emergency requirements and necessary to 
meet emergency needs pursuant to section 204 of S. Con. Res. 
21 (110th Congress), the concurrent resolution on the budget for 
fiscal year 2008. 
TITLE I—FHA MODERNIZATION ACT OF 
2008 
SEC. 2101. SHORT TITLE. 
This title may be cited as the ‘‘FHA Modernization Act of 
2008’’. 
Subtitle A—Building American 
Homeownership 
SEC. 2111. SHORT TITLE. 
This subtitle may be cited as the ‘‘Building American 
Homeownership Act of 2008’’. 
SEC. 2112. MAXIMUM PRINCIPAL LOAN OBLIGATION. 
(a) IN GENERAL.—Paragraph (2) of section 203(b) of the National 
Housing Act (12 U.S.C. 1709(b)(2)) is amended— 
(1) by striking subparagraphs (A) and (B) and inserting 
the following: 
‘‘(A) not to exceed the lesser of— 
‘‘(i) in the case of a 1-family residence, 115 percent 
of the median 1-family house price in the area, as 
determined by the Secretary; and in the case of a 
2-, 3-, or 4-family residence, the percentage of such 
median price that bears the same ratio to such median 
price as the dollar amount limitation determined under 
the sixth sentence of section 305(a)(2) of the Federal 
Home Loan Mortgage Corporation Act (12 U.S.C. 
1454(a)(2)) for a 2-, 3-, or 4-family residence, respec-
tively, bears to the dollar amount limitation deter-
mined under such section for a 1-family residence; 
or 
12 USC 1701 
note. 
Building 
American 
Homeownership 
Act of 2008. 
12 USC 1701 
note. 
FHA 
Modernization 
Act of 2008. 
12 USC 1701 
note. 
Foreclosure 
Prevention Act 
of 2008. 
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122 STAT. 2831 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) 150 percent of the dollar amount limitation 
determined under the sixth sentence of such section 
305(a)(2) for a residence of applicable size; 
except that the dollar amount limitation in effect under 
this subparagraph for any size residence for any area may 
not be less than the greater of: (I) the dollar amount 
limitation in effect under this section for the area on 
October 21, 1998; or (II) 65 percent of the dollar amount 
limitation determined under the sixth sentence of such 
section 305(a)(2) for a residence of the applicable size; 
and 
‘‘(B) not to exceed 100 percent of the appraised value 
of the property.’’; and 
(2) in the matter following subparagraph (B), by striking 
the second sentence (relating to a definition of ‘‘average closing 
cost’’) and all that follows through ‘‘section 3103A(d) of title 
38, United States Code.’’. 
(b) TREATMENT OF UP-FRONT PREMIUMS.—Section 203(d) of the 
National Housing Act (12 U.S.C. 1709(d)) is amended— 
(1) by striking ‘‘Notwithstanding any’’ and inserting the 
following: ‘‘Except as provided in paragraph (2) of this sub-
section, notwithstanding’’; 
(2) by inserting ‘‘(1)’’ after ‘‘(d)’’; and 
(3) by adding at the end the following new paragraph: 
‘‘(2) The maximum amount of a mortgage determined under 
subsection (b)(2)(B) of this section may not be increased as provided 
in paragraph (1).’’. 
(c) EFFECTIVE DATE.— The amendments made by subsection 
(a) shall take effect upon the expiration of the date described 
in section 202(a) of the Economic Stimulus Act of 2008 (Public 
Law 110–185; 122 Stat. 620). 
SEC. 2113. CASH INVESTMENT REQUIREMENT AND PROHIBITION OF 
SELLER-FUNDED DOWN PAYMENT ASSISTANCE. 
Paragraph (9) of section 203(b) of the National Housing Act 
(12 U.S.C. 1709(b)(9)) is amended to read as follows: 
‘‘(9) CASH INVESTMENT REQUIREMENT.— 
‘‘(A) IN GENERAL.—A mortgage insured under this sec-
tion shall be executed by a mortgagor who shall have 
paid, in cash or its equivalent, on account of the property 
an amount equal to not less than 3.5 percent of the 
appraised value of the property or such larger amount 
as the Secretary may determine. 
‘‘(B) FAMILY
MEMBERS.—For purposes of this para-
graph, the Secretary shall consider as cash or its equivalent 
any amounts borrowed from a family member (as such 
term is defined in section 201), subject only to the require-
ments that, in any case in which the repayment of such 
borrowed amounts is secured by a lien against the property, 
that— 
‘‘(i) such lien shall be subordinate to the mortgage; 
and 
‘‘(ii) the sum of the principal obligation of the 
mortgage and the obligation secured by such lien may 
not exceed 100 percent of the appraised value of the 
property plus any initial service charges, appraisal, 
12 USC 1709 
note. 
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122 STAT. 2832 
PUBLIC LAW 110–289—JULY 30, 2008 
inspection, and other fees in connection with the mort-
gage. 
‘‘(C) PROHIBITED SOURCES.—In no case shall the funds 
required by subparagraph (A) consist, in whole or in part, 
of funds provided by any of the following parties before, 
during, or after closing of the property sale: 
‘‘(i) The seller or any other person or entity that 
financially benefits from the transaction. 
‘‘(ii) Any third party or entity that is reimbursed, 
directly or indirectly, by any of the parties described 
in clause (i). 
This subparagraph shall apply only to mortgages for which 
the mortgagee has issued credit approval for the borrower 
on or after October 1, 2008.’’. 
SEC. 2114. MORTGAGE INSURANCE PREMIUMS. 
Section 203(c)(2) of the National Housing Act (12 U.S.C. 
1709(c)(2)) is amended— 
(1) in the matter preceding subparagraph (A), by striking 
‘‘or of the General Insurance Fund’’ and all that follows through 
‘‘section 234(c),,’’; and 
(2) in subparagraph (A)— 
(A) by striking ‘‘2.25 percent’’ and inserting ‘‘3 percent’’; 
and 
(B) by striking ‘‘2.0 percent’’ and inserting ‘‘2.75 per-
cent’’. 
SEC. 2115. REHABILITATION LOANS. 
Subsection (k) of section 203 of the National Housing Act (12 
U.S.C. 1709(k)) is amended— 
(1) in paragraph (1), by striking ‘‘on’’ and all that follows 
through ‘‘1978’’; and 
(2) in paragraph (5)— 
(A) by striking ‘‘General Insurance Fund’’ the first 
place it appears and inserting ‘‘Mutual Mortgage Insurance 
Fund’’; and 
(B) in the second sentence, by striking the comma 
and all that follows through ‘‘General Insurance Fund’’. 
SEC. 2116. DISCRETIONARY ACTION. 
The National Housing Act is amended— 
(1) in subsection (e) of section 202 (12 U.S.C. 1708(e))— 
(A) in paragraph (3)(B), by striking ‘‘section 202(e) 
of the National Housing Act’’ and inserting ‘‘this sub-
section’’; and 
(B) by redesignating such subsection as subsection (f); 
(2) by striking paragraph (4) of section 203(s) (12 U.S.C. 
1709(s)(4)) and inserting the following new paragraph: 
‘‘(4) the Secretary of Agriculture;’’; and 
(3) by transferring subsection (s) of section 203 (as amended 
by paragraph (2) of this section) to section 202, inserting such 
subsection after subsection (d) of section 202, and redesignating 
such subsection as subsection (e). 
SEC. 2117. INSURANCE OF CONDOMINIUMS. 
(a) IN GENERAL.—Section 234 of the National Housing Act 
(12 U.S.C. 1715y) is amended— 
(1) in subsection (c), in the first sentence— 
Applicability. 
Effective date. 
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122 STAT. 2833 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) by striking ‘‘and’’ before ‘‘(2)’’; and 
(B) by inserting before the period at the end the fol-
lowing: ‘‘, and (3) the project has a blanket mortgage 
insured by the Secretary under subsection (d)’’; and 
(2) in subsection (g), by striking ‘‘, except that’’ and all 
that follows and inserting a period. 
(b) DEFINITION OF MORTGAGE.—Section 201(a) of the National 
Housing Act (12 U.S.C. 1707(a)) is amended— 
(1) before ‘‘a first mortgage’’ insert ‘‘(A)’’; 
(2) by striking ‘‘or on a leasehold (1)’’ and inserting ‘‘(B) 
a first mortgage on a leasehold on real estate (i)’’; 
(3) by striking ‘‘or (2)’’ and inserting ‘‘, or (ii)’’; and 
(4) by inserting before the semicolon the following: ‘‘, or 
(C) a first mortgage given to secure the unpaid purchase price 
of a fee interest in, or long-term leasehold interest in, real 
estate consisting of a one-family unit in a multifamily project, 
including a project in which the dwelling units are attached, 
or are manufactured housing units, semi-detached, or detached, 
and an undivided interest in the common areas and facilities 
which serve the project’’. 
(c) DEFINITION OF REAL ESTATE.—Section 201 of the National 
Housing Act (12 U.S.C. 1707) is amended by adding at the end 
the following new subsection: 
‘‘(g) The term ‘real estate’ means land and all natural resources 
and structures permanently affixed to the land, including residential 
buildings and stationary manufactured housing. The Secretary may 
not require, for treatment of any land or other property as real 
estate for purposes of this title, that such land or property be 
treated as real estate for purposes of State taxation.’’. 
SEC. 2118. MUTUAL MORTGAGE INSURANCE FUND. 
(a) IN GENERAL.—Subsection (a) of section 202 of the National 
Housing Act (12 U.S.C. 1708(a)) is amended to read as follows: 
‘‘(a) MUTUAL MORTGAGE INSURANCE FUND.— 
‘‘(1) ESTABLISHMENT.—Subject to the provisions of the Fed-
eral Credit Reform Act of 1990, there is hereby created a 
Mutual Mortgage Insurance Fund (in this title referred to as 
the ‘Fund’), which shall be used by the Secretary to carry 
out the provisions of this title with respect to mortgages insured 
under section 203. The Secretary may enter into commitments 
to guarantee, and may guarantee, such insured mortgages. 
‘‘(2) LIMIT ON LOAN GUARANTEES.—The authority of the 
Secretary to enter into commitments to guarantee such insured 
mortgages shall be effective for any fiscal year only to the 
extent that the aggregate original principal loan amount under 
such mortgages, any part of which is guaranteed, does not 
exceed the amount specified in appropriations Acts for such 
fiscal year. 
‘‘(3) FIDUCIARY
RESPONSIBILITY.—The Secretary has a 
responsibility to ensure that the Mutual Mortgage Insurance 
Fund remains financially sound. 
‘‘(4) ANNUAL
INDEPENDENT
ACTUARIAL
STUDY.—The Sec-
retary shall provide for an independent actuarial study of the 
Fund to be conducted annually, which shall analyze the finan-
cial position of the Fund. The Secretary shall submit a report 
annually to the Congress describing the results of such study 
and assessing the financial status of the Fund. The report 
Reports. 
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122 STAT. 2834 
PUBLIC LAW 110–289—JULY 30, 2008 
shall recommend adjustments to underwriting standards, pro-
gram participation, or premiums, if necessary, to ensure that 
the Fund remains financially sound. The report shall also 
include an evaluation of the quality control procedures and 
accuracy of information utilized in the process of underwriting 
loans guaranteed by the Fund. Such evaluation shall include 
a review of the risk characteristics of loans based not only 
on borrower information and performance, but on risks associ-
ated with loans originated or funded by various entities or 
financial institutions. 
‘‘(5) QUARTERLY
REPORTS.—During each fiscal year, the 
Secretary shall submit a report to the Congress for each cal-
endar quarter, which shall specify for mortgages that are obliga-
tions of the Fund— 
‘‘(A) the cumulative volume of loan guarantee commit-
ments that have been made during such fiscal year through 
the end of the quarter for which the report is submitted; 
‘‘(B) the types of loans insured, categorized by risk; 
‘‘(C) any significant changes between actual and pro-
jected claim and prepayment activity; 
‘‘(D) projected versus actual loss rates; and 
‘‘(E) updated projections of the annual subsidy rates 
to ensure that increases in risk to the Fund are identified 
and mitigated by adjustments to underwriting standards, 
program participation, or premiums, and the financial 
soundness of the Fund is maintained. 
The first quarterly report under this paragraph shall be sub-
mitted on the last day of the first quarter of fiscal year 2008, 
or on the last day of the first full calendar quarter following 
the enactment of the Building American Homeownership Act 
of 2008, whichever is later. 
‘‘(6) ADJUSTMENT OF PREMIUMS.—If, pursuant to the inde-
pendent actuarial study of the Fund required under paragraph 
(4), the Secretary determines that the Fund is not meeting 
the operational goals established under paragraph (7) or there 
is a substantial probability that the Fund will not maintain 
its established target subsidy rate, the Secretary may either 
make programmatic adjustments under this title as necessary 
to reduce the risk to the Fund, or make appropriate premium 
adjustments. 
‘‘(7) OPERATIONAL GOALS.—The operational goals for the 
Fund are— 
‘‘(A) to minimize the default risk to the Fund and 
to homeowners by among other actions instituting fraud 
prevention quality control screening not later than 18 
months after the date of enactment of the Building Amer-
ican Homeownership Act of 2008; and 
‘‘(B) to meet the housing needs of the borrowers that 
the single family mortgage insurance program under this 
title is designed to serve.’’. 
(b) OBLIGATIONS
OF FUND.—The National Housing Act is 
amended as follows: 
(1) HOMEOWNERSHIP VOUCHER PROGRAM MORTGAGES.—In 
section 203(v) (12 U.S.C. 1709(v))— 
(A) by striking ‘‘Notwithstanding section 202 of this 
title, the’’ and inserting ‘‘The’’; and 
Deadline. 
Deadline. 
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122 STAT. 2835 
PUBLIC LAW 110–289—JULY 30, 2008 
(B) by striking ‘‘General Insurance Fund’’ the first 
place such term appears and all that follows through the 
end of the subsection and inserting ‘‘Mutual Mortgage 
Insurance Fund.’’. 
(2) 
HOME
EQUITY
CONVERSION
MORTGAGES.—Section 
255(i)(2)(A) of the National Housing Act (12 U.S.C. 1715z– 
20(i)(2)(A)) is amended by striking ‘‘General Insurance Fund’’ 
and inserting ‘‘Mutual Mortgage Insurance Fund’’. 
(c) CONFORMING AMENDMENTS.—The National Housing Act is 
amended— 
(1) in section 205 (12 U.S.C. 1711), by striking subsections 
(g) and (h); and 
(2) in section 519(e) (12 U.S.C. 1735c(e)), by striking 
‘‘203(b)’’ and all that follows through ‘‘203(i)’’ and inserting 
‘‘203, except as determined by the Secretary’’. 
SEC. 2119. HAWAIIAN HOME LANDS AND INDIAN RESERVATIONS. 
(a) HAWAIIAN HOME LANDS.—Section 247(c) of the National 
Housing Act (12 U.S.C. 1715z–12(c)) is amended— 
(1) by striking ‘‘General Insurance Fund established in 
section 519’’ and inserting ‘‘Mutual Mortgage Insurance Fund’’; 
and 
(2) in the second sentence, by striking ‘‘(1) all references’’ 
and all that follows through ‘‘and (2)’’. 
(b) INDIAN
RESERVATIONS.—Section 248(f) of the National 
Housing Act (12 U.S.C. 1715z–13(f)) is amended— 
(1) by striking ‘‘General Insurance Fund’’ the first place 
it appears through ‘‘519’’ and inserting ‘‘Mutual Mortgage Insur-
ance Fund’’; and 
(2) in the second sentence, by striking ‘‘(1) all references’’ 
and all that follows through ‘‘and (2)’’. 
SEC. 2120. CONFORMING AND TECHNICAL AMENDMENTS. 
(a) REPEALS.—The following provisions of the National Housing 
Act are repealed: 
(1) Subsection (i) of section 203 (12 U.S.C. 1709(i)). 
(2) Subsection (o) of section 203 (12 U.S.C. 1709(o)). 
(3) Subsection (p) of section 203 (12 U.S.C. 1709(p)). 
(4) Subsection (q) of section 203 (12 U.S.C. 1709(q)). 
(5) Section 222 (12 U.S.C. 1715m). 
(6) Section 237 (12 U.S.C. 1715z–2). 
(7) Section 245 (12 U.S.C. 1715z–10). 
(b) DEFINITION OF AREA.—Section 203(u)(2)(A) of the National 
Housing Act (12 U.S.C. 1709(u)(2)(A)) is amended by striking ‘‘shall’’ 
and all that follows and inserting ‘‘means a metropolitan statistical 
area as established by the Office of Management and Budget;’’. 
(c) DEFINITION
OF STATE.—Section 201(d) of the National 
Housing Act (12 U.S.C. 1707(d)) is amended by striking ‘‘the Trust 
Territory of the Pacific Islands’’ and inserting ‘‘the Commonwealth 
of the Northern Mariana Islands’’. 
SEC. 2121. INSURANCE OF MORTGAGES. 
Subsection (n)(2) of section 203 of the National Housing Act 
(12 U.S.C. 1709(n)(2)) is amended— 
(1) in subparagraph (A), by inserting ‘‘or subordinate mort-
gage or’’ before ‘‘lien given’’; and 
(2) in subparagraph (C), by inserting ‘‘or subordinate mort-
gage or’’ before ‘‘lien’’. 
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122 STAT. 2836 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 2122. HOME EQUITY CONVERSION MORTGAGES. 
(a) IN GENERAL.—Section 255 of the National Housing Act 
(12 U.S.C. 1715z–20) is amended— 
(1) in subsection (b)(2), insert ‘‘ ‘real estate,’ ’’ after ‘‘ ‘mort-
gagor’,’’; 
(2) by amending subsection (d)(1) to read as follows: 
‘‘(1) have been originated by a mortgagee approved by 
the Secretary;’’; 
(3) by amending subsection (d)(2)(B) to read as follows: 
‘‘(B) has received adequate counseling, as provided in 
subsection (f), by an independent third party that is not, 
either directly or indirectly, associated with or compensated 
by a party involved in— 
‘‘(i) originating or servicing the mortgage; 
‘‘(ii) funding the loan underlying the mortgage; 
or 
‘‘(iii) the sale of annuities, investments, long-term 
care insurance, or any other type of financial or insur-
ance product;’’; 
(4) in subsection (f)— 
(A) by striking ‘‘(f) INFORMATION SERVICES FOR MORT-
GAGORS.—’’ and inserting ‘‘(f) COUNSELING SERVICES AND 
INFORMATION FOR MORTGAGORS.—’’; and 
(B) by amending the matter preceding paragraph (1) 
to read as follows: ‘‘The Secretary shall provide or cause 
to be provided adequate counseling for the mortgagor, as 
described in subsection (d)(2)(B). Such counseling shall be 
provided by counselors that meet qualification standards 
and follow uniform counseling protocols. The qualification 
standards and counseling protocols shall be established 
by the Secretary within 12 months of the date of enactment 
of the Building American Homeownership Act of 2008. 
The protocols shall require a qualified counselor to discuss 
with each mortgagor information which shall include— 
’’ 
(5) in subsection (g), by striking ‘‘established under section 
203(b)(2)’’ and all that follows through ‘‘located’’ and inserting 
‘‘limitation established under section 305(a)(2) of the Federal 
Home Loan Mortgage Corporation Act for a 1-family residence’’; 
(6) by striking subsection (l); 
(7) by redesignating subsection (m) as subsection (l); 
(8) by amending subsection (l), as so redesignated, to read 
as follows: 
‘‘(l) FUNDING FOR COUNSELING.—The Secretary may use a por-
tion of the mortgage insurance premiums collected under the pro-
gram under this section to adequately fund the counseling and 
disclosure activities required under subsection (f), including coun-
seling for those homeowners who elect not to take out a home 
equity conversion mortgage, provided that the use of such funds 
is based upon accepted actuarial principles.’’; and 
(9) by adding at the end the following new subsection: 
‘‘(m) AUTHORITY TO INSURE HOME PURCHASE MORTGAGE.— 
‘‘(1) IN GENERAL.—Notwithstanding any other provision of 
this section, the Secretary may insure, upon application by 
a mortgagee, a home equity conversion mortgage upon such 
terms and conditions as the Secretary may prescribe, when 
the home equity conversion mortgage will be used to purchase 
Standards. 
Deadline. 
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122 STAT. 2837 
PUBLIC LAW 110–289—JULY 30, 2008 
a 1- to 4-family dwelling unit, one unit of which the mortgagor 
will occupy as a primary residence, and to provide for any 
future payments to the mortgagor, based on available equity, 
as authorized under subsection (d)(9). 
‘‘(2) LIMITATION ON PRINCIPAL OBLIGATION.—A home equity 
conversion mortgage insured pursuant to paragraph (1) shall 
involve a principal obligation that does not exceed the dollar 
amount limitation determined under section 305(a)(2) of the 
Federal Home Loan Mortgage Corporation Act for a 1-family 
residence. 
‘‘(n) REQUIREMENTS ON MORTGAGE ORIGINATORS.— 
‘‘(1) IN GENERAL.—The mortgagee and any other party that 
participates in the origination of a mortgage to be insured 
under this section shall— 
‘‘(A) not participate in, be associated with, or employ 
any party that participates in or is associated with any 
other financial or insurance activity; or 
‘‘(B) demonstrate to the Secretary that the mortgagee 
or other party maintains, or will maintain, firewalls and 
other safeguards designed to ensure that— 
‘‘(i) individuals participating in the origination of 
the mortgage shall have no involvement with, or incen-
tive to provide the mortgagor with, any other financial 
or insurance product; and 
‘‘(ii) the mortgagor shall not be required, directly 
or indirectly, as a condition of obtaining a mortgage 
under this section, to purchase any other financial 
or insurance product. 
‘‘(2) APPROVAL OF OTHER PARTIES.—All parties that partici-
pate in the origination of a mortgage to be insured under 
this section shall be approved by the Secretary. 
‘‘(o) PROHIBITION AGAINST REQUIREMENTS TO PURCHASE ADDI-
TIONAL PRODUCTS.—The mortgagor or any other party shall not 
be required by the mortgagee or any other party to purchase an 
insurance, annuity, or other similar product as a requirement or 
condition of eligibility for insurance under subsection (c), except 
for title insurance, hazard, flood, or other peril insurance, or other 
such products that are customary and normal under subsection 
(c), as determined by the Secretary. 
‘‘(p) STUDY TO DETERMINE CONSUMER PROTECTIONS AND UNDER-
WRITING STANDARDS.—The Secretary shall conduct a study to 
examine and determine appropriate consumer protections and 
underwriting standards to ensure that the purchase of products 
referred to in subsection (o) is appropriate for the consumer. In 
conducting such study, the Secretary shall consult with consumer 
advocates (including recognized experts in consumer protection), 
industry representatives, representatives of counseling organiza-
tions, and other interested parties.’’. 
(b) MORTGAGES FOR COOPERATIVES.—Subsection (b) of section 
255 of the National Housing Act (12 U.S.C. 1715z–20(b)) is 
amended— 
(1) in paragraph (4)— 
(A) by inserting ‘‘a first or subordinate mortgage or 
lien’’ before ‘‘on all stock’’; 
(B) by inserting ‘‘unit’’ after ‘‘dwelling’’; and 
(C) by inserting ‘‘a first mortgage or first lien’’ before 
‘‘on a leasehold’’; and 
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122 STAT. 2838 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) in paragraph (5), by inserting ‘‘a first or subordinate 
lien on’’ before ‘‘all stock’’. 
(c) LIMITATION
ON ORIGINATION FEES.—Section 255 of the 
National Housing Act (12 U.S.C. 1715z–20), as amended by the 
preceding provisions of this section, is further amended by adding 
at the end the following new subsection: 
‘‘(r) LIMITATION ON ORIGINATION FEES.—The Secretary shall 
establish limits on the origination fee that may be charged to 
a mortgagor under a mortgage insured under this section, which 
limitations shall— 
‘‘(1) be equal to 2.0 percent of the maximum claim amount 
of the mortgage, up to a maximum claim amount of $200,000 
plus 1 percent of any portion of the maximum claim amount 
that is greater than $200,000, unless adjusted thereafter on 
the basis of an analysis of— 
‘‘(A) the costs to mortgagors; and 
‘‘(B) the impact on the reverse mortgage market; 
‘‘(2) be subject to a minimum allowable amount; 
‘‘(3) provide that the origination fee may be fully financed 
with the mortgage; 
‘‘(4) include any fees paid to correspondent mortgagees 
approved by the Secretary; 
‘‘(5) have the same effective date as subsection (m)(2) 
regarding the limitation on principal obligation; and 
‘‘(6) be subject to a maximum origination fee of $6,000, 
except that such maximum limit shall be adjusted in accordance 
with the annual percentage increase in the Consumer Price 
Index of the Bureau of Labor Statistics of the Department 
of Labor in increments of $500 only when the percentage 
increase in such index, when applied to the maximum origina-
tion fee, produces dollar increases that exceed $500.’’. 
(d) STUDY REGARDING PROGRAM COSTS
AND CREDIT AVAIL-
ABILITY.— 
(1) IN GENERAL.—The Comptroller General of the United 
States shall conduct a study regarding the costs and availability 
of credit under the home equity conversion mortgages for 
elderly homeowners program under section 255 of the National 
Housing Act (12 U.S.C. 1715z–20) (in this subsection referred 
to as the ‘‘program’’). 
(2) PURPOSE.—The purpose of the study required under 
paragraph (1) is to help Congress analyze and determine the 
effects of limiting the amounts of the costs or fees under the 
program from the amounts charged under the program as of 
the date of the enactment of this title. 
(3) CONTENT OF REPORT.—The study required under para-
graph (1) should focus on— 
(A) the cost to mortgagors of participating in the pro-
gram; 
(B) the financial soundness of the program; 
(C) the availability of credit under the program; and 
(D) the costs to elderly homeowners participating in 
the program, including— 
(i) mortgage insurance premiums charged under 
the program; 
(ii) up-front fees charged under the program; and 
(iii) margin rates charged under the program. 
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122 STAT. 2839 
PUBLIC LAW 110–289—JULY 30, 2008 
(4) TIMING OF REPORT.—Not later than 12 months after 
the date of the enactment of this title, the Comptroller General 
shall submit a report to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Finan-
cial Services of the House of Representatives setting forth the 
results and conclusions of the study required under paragraph 
(1). 
SEC. 2123. ENERGY EFFICIENT MORTGAGES PROGRAM. 
Section 106(a)(2) of the Energy Policy Act of 1992 (42 U.S.C. 
12712 note) is amended— 
(1) by amending subparagraph (C) to read as follows: 
‘‘(C) COSTS OF IMPROVEMENTS.—The cost of cost-effec-
tive energy efficiency improvements shall not exceed the 
greater of— 
‘‘(i) 5 percent of the property value (not to exceed 
5 percent of the limit established under section 
203(b)(2)(A)) of the National Housing Act (12 U.S.C. 
1709(b)(2)(A); or 
‘‘(ii) 2 percent of the limit established under section 
203(b)(2)(B) of such Act.’’; and 
(2) by adding at the end the following: 
‘‘(D) LIMITATION.—In any fiscal year, the aggregate 
number of mortgages insured pursuant to this section may 
not exceed 5 percent of the aggregate number of mortgages 
for 1- to 4-family residences insured by the Secretary of 
Housing and Urban Development under title II of the 
National Housing Act (12 U.S.C. 1707 et seq.) during the 
preceding fiscal year.’’. 
SEC. 2124. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BOR-
ROWERS WITHOUT SUFFICIENT CREDIT HISTORY. 
(a) ESTABLISHMENT.—Title II of the National Housing Act (12 
U.S.C. 1707 et seq.) is amended by adding at the end the following 
new section: 
‘‘SEC. 257. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BOR-
ROWERS WITHOUT SUFFICIENT CREDIT HISTORY. 
‘‘(a) ESTABLISHMENT.—The Secretary shall carry out a pilot 
program to establish, and make available to mortgagees, an auto-
mated process for providing alternative credit rating information 
for mortgagors and prospective mortgagors under mortgages on 
1- to 4-family residences to be insured under this title who have 
insufficient credit histories for determining their creditworthiness. 
Such alternative credit rating information may include rent, utili-
ties, and insurance payment histories, and such other information 
as the Secretary considers appropriate. 
‘‘(b) SCOPE.—The Secretary may carry out the pilot program 
under this section on a limited basis or scope, and may consider 
limiting the program to first-time homebuyers. 
‘‘(c) LIMITATION.—In any fiscal year, the aggregate number 
of mortgages insured pursuant to the automated process established 
under this section may not exceed 5 percent of the aggregate 
number of mortgages for 1- to 4-family residences insured by the 
Secretary under this title during the preceding fiscal year. 
‘‘(d) SUNSET.—After the expiration of the 5-year period begin-
ning on the date of the enactment of the Building American 
Homeownership Act of 2008, the Secretary may not enter into 
12 USC 
1715z–24. 
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122 STAT. 2840 
PUBLIC LAW 110–289—JULY 30, 2008 
any new commitment to insure any mortgage, or newly insure 
any mortgage, pursuant to the automated process established under 
this section.’’. 
(b) GAO REPORT.—Not later than the expiration of the two- 
year period beginning on the date of the enactment of this subtitle, 
the Comptroller General of the United States shall submit to the 
Congress a report identifying the number of additional mortgagors 
served using the automated process established pursuant to section 
257 of the National Housing Act (as added by the amendment 
made by subsection (a) of this section) and the impact of such 
process and the insurance of mortgages pursuant to such process 
on the safety and soundness of the insurance funds under the 
National Housing Act of which such mortgages are obligations. 
SEC. 2125. HOMEOWNERSHIP PRESERVATION. 
The Secretary of Housing and Urban Development and the 
Commissioner of the Federal Housing Administration, in consulta-
tion with industry, the Neighborhood Reinvestment Corporation, 
and other entities involved in foreclosure prevention activities, 
shall— 
(1) develop and implement a plan to improve the Federal 
Housing Administration’s loss mitigation process; and 
(2) report such plan to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Finan-
cial Services of the House of Representatives. 
SEC. 2126. USE OF FHA SAVINGS FOR IMPROVEMENTS IN FHA TECH-
NOLOGIES, 
PROCEDURES, 
PROCESSES, 
PROGRAM 
PERFORMANCE, STAFFING, AND SALARIES. 
(a) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 
to be appropriated for each of fiscal years 2009 through 2013, 
$25,000,000, from negative credit subsidy for the mortgage insur-
ance programs under title II of the National Housing Act, to the 
Secretary of Housing and Urban Development for increasing 
funding for the purpose of improving technology, processes, program 
performance, eliminating fraud, and for providing appropriate 
staffing in connection with the mortgage insurance programs under 
title II of the National Housing Act. 
(b) CERTIFICATION.—The authorization under subsection (a) 
shall not be effective for a fiscal year unless the Secretary of 
Housing and Urban Development has, by rulemaking in accordance 
with section 553 of title 5, United States Code (notwithstanding 
subsections (a)(2), (b)(B), and (d)(3) of such section), made a deter-
mination that— 
(1) premiums being, or to be, charged during such fiscal 
year for mortgage insurance under title II of the National 
Housing Act are established at the minimum amount sufficient 
to— 
(A) comply with the requirements of section 205(f) 
of such Act (relating to required capital ratio for the Mutual 
Mortgage Insurance Fund); and 
(B) ensure the safety and soundness of the other mort-
gage insurance funds under such Act; and 
(2) any negative credit subsidy for such fiscal year resulting 
from such mortgage insurance programs adequately ensures 
the efficient delivery and availability of such programs. 
(c) STUDY AND REPORT.—The Secretary of Housing and Urban 
Development shall conduct a study to obtain recommendations from 
Regulations. 
Reports. 
Plans. 
12 USC 1710 
note. 
Deadline. 
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122 STAT. 2841 
PUBLIC LAW 110–289—JULY 30, 2008 
participants in the private residential (both single family and multi-
family) mortgage lending business and the secondary market for 
such mortgages on how best to update and upgrade processes and 
technologies for the mortgage insurance programs under title II 
of the National Housing Act so that the procedures for originating, 
insuring, and servicing of such mortgages conform with those cus-
tomarily used by secondary market purchasers of residential mort-
gage loans. Not later than the expiration of the 12-month period 
beginning on the date of the enactment of this title, the Secretary 
shall submit a report to the Congress describing the progress made 
and to be made toward updating and upgrading such processes 
and technology, and providing appropriate staffing for such mort-
gage insurance programs. 
SEC. 2127. POST-PURCHASE HOUSING COUNSELING ELIGIBILITY 
IMPROVEMENTS. 
Section 106(c)(4) of the Housing and Urban Development Act 
of 1968 (12 U.S.C. 1701x(c)(4)) is amended: 
(1) in subparagraph (C)— 
(A) in clause (i), by striking ‘‘; or’’ and inserting a 
semicolon; 
(B) in clause (ii), by striking the period at the end 
and inserting a semicolon; and 
(C) by adding at the end the following: 
‘‘(iii) a significant reduction in the income of the 
household due to divorce or death; or 
‘‘(iv) a significant increase in basic expenses of 
the homeowner or an immediate family member of 
the homeowner (including the spouse, child, or parent 
for whom the homeowner provides substantial care 
or financial assistance) due to— 
‘‘(I) an unexpected or significant increase in 
medical expenses; 
‘‘(II) a divorce; 
‘‘(III) unexpected and significant damage to 
the property, the repair of which will not be cov-
ered by private or public insurance; or 
‘‘(IV) a large property-tax increase; or’’; 
(2) by striking the matter that follows subparagraph (C); 
and 
(3) by adding at the end the following: 
‘‘(D) the Secretary of Housing and Urban Development 
determines that the annual income of the homeowner is 
no greater than the annual income established by the Sec-
retary as being of low- or moderate-income.’’. 
SEC. 2128. PRE-PURCHASE HOMEOWNERSHIP COUNSELING DEM-
ONSTRATION. 
(a) ESTABLISHMENT OF PROGRAM.—For the period beginning 
on the date of enactment of this title and ending on the date 
that is 3 years after such date of enactment, the Secretary of 
Housing and Urban Development shall establish and conduct a 
demonstration program to test the effectiveness of alternative forms 
of pre-purchase homeownership counseling for eligible homebuyers. 
(b) FORMS
OF COUNSELING.—The Secretary of Housing and 
Urban Development shall provide to eligible homebuyers pre-pur-
chase homeownership counseling under this section in the form 
of— 
12 USC 1701x 
note. 
Deadline. 
Reports. 
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122 STAT. 2842 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) telephone counseling; 
(2) individualized in-person counseling; 
(3) web-based counseling; 
(4) counseling classes; or 
(5) any other form or type of counseling that the Secretary 
may, in his discretion, determine appropriate. 
(c) SIZE
OF PROGRAM.—The Secretary shall make available 
the pre-purchase homeownership counseling described in subsection 
(b) to not more than 3,000 eligible homebuyers in any given year. 
(d) INCENTIVE TO PARTICIPATE.—The Secretary of Housing and 
Urban Development may provide incentives to eligible homebuyers 
to participate in the demonstration program established under sub-
section (a). Such incentives may include the reduction of any insur-
ance premium charges owed by the eligible homebuyer to the Sec-
retary. 
(e) ELIGIBLE HOMEBUYER DEFINED.—For purposes of this sec-
tion an ‘‘eligible homebuyer’’ means a first-time homebuyer who 
has been approved for a home loan with a loan-to-value ratio 
between 97 percent and 98.5 percent. 
(f) REPORT TO CONGRESS.—The Secretary of Housing and Urban 
Development shall report to the Committee on Banking, Housing, 
and Urban Affairs of the Senate and the Committee on Financial 
Services of the House of Representative— 
(1) on an annual basis, on the progress and results of 
the demonstration program established under subsection (a); 
and 
(2) for the period beginning on the date of enactment of 
this title and ending on the date that is 5 years after such 
date of enactment, on the payment history and delinquency 
rates of eligible homebuyers who participated in the demonstra-
tion program. 
SEC. 2129. FRAUD PREVENTION. 
Section 1014 of title 18, United States Code, is amended in 
the first sentence— 
(1) by inserting ‘‘the Federal Housing Administration,’’ 
before ‘‘the Farm Credit Administration’’; and 
(2) by striking ‘‘commitment, or loan’’ and inserting 
‘‘commitment, loan, or insurance agreement or application for 
insurance or a guarantee’’. 
SEC. 
2130. 
LIMITATION 
ON 
MORTGAGE 
INSURANCE 
PREMIUM 
INCREASES. 
(a) IN GENERAL.—Notwithstanding any other provision of law, 
including any provision of this title and any amendment made 
by this title— 
(1) for the period beginning on the date of the enactment 
of this title and ending on October 1, 2009, the premiums 
charged for mortgage insurance under multifamily housing pro-
grams under the National Housing Act may not be increased 
above the premium amounts in effect under such program 
on October 1, 2006, unless the Secretary of Housing and Urban 
Development determines that, absent such increase, insurance 
of additional mortgages under such program would, under the 
Federal Credit Reform Act of 1990, require the appropriation 
of new budget authority to cover the costs (as such term is 
defined in section 502 of the Federal Credit Reform Act of 
1990 (2 U.S.C. 661a) of such insurance; and 
12 USC 1709 
note. 
Deadline. 
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122 STAT. 2843 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) a premium increase pursuant to paragraph (1) may 
be made only if not less than 30 days prior to such increase 
taking effect, the Secretary of Housing and Urban Develop-
ment— 
(A) notifies the Committee on Banking, Housing, and 
Urban Affairs of the Senate and the Committee on Finan-
cial Services of the House of Representatives of such 
increase; and 
(B) publishes notice of such increase in the Federal 
Register. 
(b) WAIVER.—The Secretary of Housing and Urban Development 
may waive the 30-day notice requirement under subsection (a)(2), 
if the Secretary determines that waiting 30-days before increasing 
premiums would cause substantial damage to the solvency of multi-
family housing programs under the National Housing Act. 
SEC. 2131. SAVINGS PROVISION. 
Any mortgage insured under title II of the National Housing 
Act before the date of enactment of this subtitle shall continue 
to be governed by the laws, regulations, orders, and terms and 
conditions to which it was subject on the day before the date 
of the enactment of this subtitle. 
SEC. 2132. IMPLEMENTATION. 
The Secretary of Housing and Urban Development shall by 
notice establish any additional requirements that may be necessary 
to immediately carry out the provisions of this subtitle. The notice 
shall take effect upon issuance. 
SEC. 2133. MORATORIUM ON IMPLEMENTATION OF RISK-BASED PRE-
MIUMS. 
(a) IN GENERAL.—During the 12-month period beginning on 
October 1, 2008, the Secretary of Housing and Urban Development 
shall not take any action to implement or carry out risk-based 
premiums, which are designed for mortgage lenders to offer bor-
rowers an FHA-insured product that provides a range of mortgage 
insurance premium pricing, based on the risk that the insurance 
contract represents, as such planned implementation was set forth 
in the Notice published in the Federal Register on May 13, 2008 
(Vol. 73, No. 93, Pages 27703 through 27711) (effective July 14, 
2008). 
(b) INSURANCE OF MORTGAGES UNDER THE NATIONAL HOUSING 
ACT.—During the 12-month period beginning on October 1, 2008, 
the Secretary of Housing and Urban Development shall not take 
any action to implement or carry out any other risk-based premium 
product related to the insurance of any mortgage on a single family 
residence under title II of the National Housing Act, where the 
premium price for such new product is based in whole or in part 
on a borrower’s Decision Credit Score, as that term is defined 
in the Notice described under subsection (a), or any successor 
thereto. 
Effective date. 
Effective date. 
Requirements. 
Notification. 
Effective date. 
12 USC 1701 
note. 
12 USC 1701 
note. 
Federal Register, 
publication. 
Notification. 
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122 STAT. 2844 
PUBLIC LAW 110–289—JULY 30, 2008 
Subtitle B—Manufactured Housing Loan 
Modernization 
SEC. 2141. SHORT TITLE. 
This subtitle may be cited as the ‘‘FHA Manufactured Housing 
Loan Modernization Act of 2008’’. 
SEC. 2142. PURPOSES. 
The purposes of this subtitle are— 
(1) to provide adequate funding for FHA-insured manufac-
tured housing loans for low- and moderate-income homebuyers 
during all economic cycles in the manufactured housing 
industry; 
(2) to modernize the FHA title I insurance program for 
manufactured housing loans to enhance participation by Ginnie 
Mae and the private lending markets; and 
(3) to adjust the low loan limits for title I manufactured 
home loan insurance to reflect the increase in costs since such 
limits were last increased in 1992 and to index the limits 
to inflation. 
SEC. 2143. EXCEPTION TO LIMITATION ON FINANCIAL INSTITUTION 
PORTFOLIO. 
The second sentence of section 2(a) of the National Housing 
Act (12 U.S.C. 1703(a)) is amended— 
(1) by striking ‘‘In no case’’ and inserting ‘‘Other than 
in connection with a manufactured home or a lot on which 
to place such a home (or both), in no case’’; and 
(2) by striking ‘‘: Provided, That with’’ and inserting ‘‘. 
With’’. 
SEC. 2144. INSURANCE BENEFITS. 
(a) IN GENERAL.—Subsection (b) of section 2 of the National 
Housing Act (12 U.S.C. 1703(b)), is amended by adding at the 
end the following new paragraph: 
‘‘(8) INSURANCE
BENEFITS
FOR
MANUFACTURED
HOUSING 
LOANS.—Any contract of insurance with respect to loans, 
advances of credit, or purchases in connection with a manufac-
tured home or a lot on which to place a manufactured home 
(or both) for a financial institution that is executed under 
this title after the date of the enactment of the FHA Manufac-
tured Housing Loan Modernization Act of 2008 by the Secretary 
shall be conclusive evidence of the eligibility of such financial 
institution for insurance, and the validity of any contract of 
insurance so executed shall be incontestable in the hands of 
the bearer from the date of the execution of such contract, 
except for fraud or misrepresentation on the part of such 
institution.’’. 
(b) APPLICABILITY.—The amendment made by subsection (a) 
shall only apply to loans that are registered or endorsed for insur-
ance after the date of the enactment of this title. 
SEC. 2145. MAXIMUM LOAN LIMITS. 
(a) DOLLAR AMOUNTS.—Paragraph (1) of section 2(b) of the 
National Housing Act (12 U.S.C. 1703(b)(1)) is amended— 
(1) in clause (ii) of subparagraph (A), by striking ‘‘$17,500’’ 
and inserting ‘‘$25,090’’; 
12 USC 1703 
note. 
Contracts. 
12 USC 1703 
note. 
12 USC 1701 
note. 
FHA 
Manufactured 
Housing Loan 
Modernization 
Act 
of 2008. 
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122 STAT. 2845 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) in subparagraph (C) by striking ‘‘$48,600’’ and inserting 
‘‘$69,678’’; 
(3) in subparagraph (D) by striking ‘‘$64,800’’ and inserting 
‘‘$92,904’’; 
(4) in subparagraph (E) by striking ‘‘$16,200’’ and inserting 
‘‘$23,226’’; and 
(5) by realigning subparagraphs (C), (D), and (E) 2 ems 
to the left so that the left margins of such subparagraphs 
are aligned with the margins of subparagraphs (A) and (B). 
(b) ANNUAL INDEXING.—Subsection (b) of section 2 of the 
National Housing Act (12 U.S.C. 1703(b)), as amended by the pre-
ceding provisions of this title, is further amended by adding at 
the end the following new paragraph: 
‘‘(9) 
ANNUAL
INDEXING
OF
MANUFACTURED
HOUSING 
LOANS.—The Secretary shall develop a method of indexing in 
order to annually adjust the loan limits established in subpara-
graphs (A)(ii), (C), (D), and (E) of this subsection. Such index 
shall be based on the manufactured housing price data collected 
by the United States Census Bureau. The Secretary shall estab-
lish such index no later than 1 year after the date of the 
enactment of the FHA Manufactured Housing Loan Moderniza-
tion Act of 2008.’’ 
(c) TECHNICAL AND CONFORMING CHANGES.—Paragraph (1) of 
section 2(b) of the National Housing Act (12 U.S.C. 1703(b)(1)) 
is amended— 
(1) by striking ‘‘No’’ and inserting ‘‘Except as provided 
in the last sentence of this paragraph, no’’; and 
(2) by adding after and below subparagraph (G) the fol-
lowing: 
‘‘The Secretary shall, by regulation, annually increase the dollar 
amount limitations in subparagraphs (A)(ii), (C), (D), and (E) (as 
such limitations may have been previously adjusted under this 
sentence) in accordance with the index established pursuant to 
paragraph (9).’’. 
SEC. 2146. INSURANCE PREMIUMS. 
Subsection (f) of section 2 of the National Housing Act (12 
U.S.C. 1703(f)) is amended— 
(1) by inserting ‘‘(1) PREMIUM CHARGES.—’’ after ‘‘(f)’’; and 
(2) by adding at the end the following new paragraph: 
‘‘(2) MANUFACTURED
HOME
LOANS.—Notwithstanding para-
graph (1), in the case of a loan, advance of credit, or purchase 
in connection with a manufactured home or a lot on which to 
place such a home (or both), the premium charge for the insurance 
granted under this section shall be paid by the borrower under 
the loan or advance of credit, as follows: 
‘‘(A) At the time of the making of the loan, advance of 
credit, or purchase, a single premium payment in an amount 
not to exceed 2.25 percent of the amount of the original insured 
principal obligation. 
‘‘(B) In addition to the premium under subparagraph (A), 
annual premium payments during the term of the loan, 
advance, or obligation purchased in an amount not exceeding 
1.0 percent of the remaining insured principal balance 
(excluding the portion of the remaining balance attributable 
to the premium collected under subparagraph (A) and without 
taking into account delinquent payments or prepayments). 
Regulations. 
Deadline. 
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122 STAT. 2846 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) Premium charges under this paragraph shall be estab-
lished in amounts that are sufficient, but do not exceed the 
minimum amounts necessary, to maintain a negative credit 
subsidy for the program under this section for insurance of 
loans, advances of credit, or purchases in connection with a 
manufactured home or a lot on which to place such a home 
(or both), as determined based upon risk to the Federal Govern-
ment under existing underwriting requirements. 
‘‘(D) The Secretary may increase the limitations on pre-
mium payments to percentages above those set forth in sub-
paragraphs (A) and (B), but only if necessary, and not in 
excess of the minimum increase necessary, to maintain a nega-
tive credit subsidy as described in subparagraph (C).’’. 
SEC. 2147. TECHNICAL CORRECTIONS. 
(a) DATES.—Subsection (a) of section 2 of the National Housing 
Act (12 U.S.C. 1703(a)) is amended— 
(1) by striking ‘‘on and after July 1, 1939,’’ each place 
such term appears; and 
(2) by striking ‘‘made after the effective date of the Housing 
Act of 1954’’. 
(b) AUTHORITY OF SECRETARY.—Subsection (c) of section 2 of 
the National Housing Act (12 U.S.C. 1703(c)) is amended to read 
as follows: 
‘‘(c) HANDLING AND DISPOSAL OF PROPERTY.— 
‘‘(1) AUTHORITY OF SECRETARY.—Notwithstanding any other 
provision of law, the Secretary may— 
‘‘(A) deal with, complete, rent, renovate, modernize, 
insure, or assign or sell at public or private sale, or other-
wise dispose of, for cash or credit in the Secretary’s discre-
tion, and upon such terms and conditions and for such 
consideration as the Secretary shall determine to be reason-
able, any real or personal property conveyed to or otherwise 
acquired by the Secretary, in connection with the payment 
of insurance heretofore or hereafter granted under this 
title, including any evidence of debt, contract, claim, per-
sonal property, or security assigned to or held by him 
in connection with the payment of insurance heretofore 
or hereafter granted under this section; and 
‘‘(B) pursue to final collection, by way of compromise 
or otherwise, all claims assigned to or held by the Secretary 
and all legal or equitable rights accruing to the Secretary 
in connection with the payment of such insurance, 
including unpaid insurance premiums owed in connection 
with insurance made available by this title. 
‘‘(2) ADVERTISEMENTS FOR PROPOSALS.—Section 3709 of the 
Revised Statutes shall not be construed to apply to any contract 
of hazard insurance or to any purchase or contract for services 
or supplies on account of such property if the amount thereof 
does not exceed $25,000. 
‘‘(3) DELEGATION OF AUTHORITY.—The power to convey and 
to execute in the name of the Secretary, deeds of conveyance, 
deeds of release, assignments and satisfactions of mortgages, 
and any other written instrument relating to real or personal 
property or any interest therein heretofore or hereafter acquired 
by the Secretary pursuant to the provisions of this title may 
be exercised by an officer appointed by the Secretary without 
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122 STAT. 2847 
PUBLIC LAW 110–289—JULY 30, 2008 
the execution of any express delegation of power or power 
of attorney. Nothing in this subsection shall be construed to 
prevent the Secretary from delegating such power by order 
or by power of attorney, in the Secretary’s discretion, to any 
officer or agent the Secretary may appoint.’’. 
SEC. 2148. REVISION OF UNDERWRITING CRITERIA. 
(a) IN GENERAL.—Subsection (b) of section 2 of the National 
Housing Act (12 U.S.C. 1703(b)), as amended by the preceding 
provisions of this title, is further amended by adding at the end 
the following new paragraph: 
‘‘(10) FINANCIAL SOUNDNESS OF MANUFACTURED HOUSING 
PROGRAM.—The Secretary shall establish such underwriting cri-
teria for loans and advances of credit in connection with a 
manufactured home or a lot on which to place a manufactured 
home (or both), including such loans and advances represented 
by obligations purchased by financial institutions, as may be 
necessary to ensure that the program under this title for insur-
ance for financial institutions against losses from such loans, 
advances of credit, and purchases is financially sound.’’. 
(b) TIMING.—Not later than the expiration of the 6-month period 
beginning on the date of the enactment of this title, the Secretary 
of Housing and Urban Development shall revise the existing under-
writing criteria for the program referred to in paragraph (10) of 
section 2(b) of the National Housing Act (as added by subsection 
(a) of this section) in accordance with the requirements of such 
paragraph. 
SEC. 2149. PROHIBITION AGAINST KICKBACKS AND UNEARNED FEES. 
Title I of the National Housing Act is amended by adding 
at the end of section 9 the following new section: 
‘‘SEC. 10. PROHIBITION AGAINST KICKBACKS AND UNEARNED FEES. 
‘‘(a) IN GENERAL.—Except as provided in subsection (b), the 
provisions of sections 3, 8, 16, 17, 18, and 19 of the Real Estate 
Settlement Procedures Act of 1974 (12 U.S.C. 2601 et seq.) shall 
apply to each sale of a manufactured home financed with an FHA- 
insured loan or extension of credit, as well as to services rendered 
in connection with such transactions. 
‘‘(b) AUTHORITY OF THE SECRETARY.—The Secretary is author-
ized to determine the manner and extent to which the provisions 
of sections 3, 8, 16, 17, 18, and 19 of the Real Estate Settlement 
Procedures Act of 1974 (12 U.S.C. 2601 et seq.) may reasonably 
be applied to the transactions described in subsection (a), and 
to grant such exemptions as may be necessary to achieve the 
purposes of this section. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) the term ‘federally related mortgage loan’ as used 
in sections 3, 8, 16, 17, 18, and 19 of the Real Estate Settlement 
Procedures Act of 1974 (12 U.S.C. 2601 et seq.) shall include 
an FHA-insured loan or extension of credit made to a borrower 
for the purpose of purchasing a manufactured home that the 
borrower intends to occupy as a personal residence; and 
‘‘(2) the term ‘real estate settlement service’ as used in 
sections 3, 8, 16, 17, 18, and 19 of the Real Estate Settlement 
Procedures Act of 1974 (12 U.S.C. 2601 et seq.) shall include 
any service rendered in connection with a loan or extension 
12 USC 1706f. 
12 USC 1703 
note. 
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122 STAT. 2848 
PUBLIC LAW 110–289—JULY 30, 2008 
of credit insured by the Federal Housing Administration for 
the purchase of a manufactured home. 
‘‘(d) UNFAIR AND DECEPTIVE PRACTICES.—In connection with 
the purchase of a manufactured home financed with a loan or 
extension of credit insured by the Federal Housing Administration 
under this title, the Secretary shall prohibit acts or practices in 
connection with loans or extensions of credit that the Secretary 
finds to be unfair, deceptive, or otherwise not in the interests 
of the borrower.’’. 
SEC. 2150. LEASEHOLD REQUIREMENTS. 
Subsection (b) of section 2 of the National Housing Act (12 
U.S.C. 1703(b)), as amended by the preceding provisions of this 
title, is further amended by adding at the end the following new 
paragraph: 
‘‘(11) LEASEHOLD REQUIREMENTS.—No insurance shall be 
granted under this section to any such financial institution 
with respect to any obligation representing any such loan, 
advance of credit, or purchase by it, made for the purposes 
of financing a manufactured home which is intended to be 
situated in a manufactured home community pursuant to a 
lease, unless such lease— 
‘‘(A) expires not less than 3 years after the origination 
date of the obligation; 
‘‘(B) is renewable upon the expiration of the original 
3 year term by successive 1 year terms; and 
‘‘(C) requires the lessor to provide the lessee written 
notice of termination of the lease not less than 180 days 
prior to the expiration of the current lease term in the 
event the lessee is required to move due to the closing 
of the manufactured home community, and further provides 
that failure to provide such notice to the mortgagor in 
a timely manner will cause the lease term, at its expiration, 
to automatically renew for an additional 1 year term.’’. 
TITLE II—MORTGAGE FORECLOSURE 
PROTECTIONS FOR SERVICEMEMBERS 
SEC. 2201. TEMPORARY INCREASE IN MAXIMUM LOAN GUARANTY 
AMOUNT FOR CERTAIN HOUSING LOANS GUARANTEED 
BY THE SECRETARY OF VETERANS AFFAIRS. 
Notwithstanding subparagraph (C) of section 3703(a)(1) of title 
38, United States Code, for purposes of any loan described in 
subparagraph (A)(i)(IV) of such section that is originated during 
the period beginning on the date of the enactment of this Act 
and ending on December 31, 2008, the term ‘‘maximum guaranty 
amount’’ shall mean an amount equal to 25 percent of the higher 
of— 
(1) the limitation determined under section 305(a)(2) of 
the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 
1454(a)(2)) for the calendar year in which the loan is originated 
for a single-family residence; or 
(2) 125 percent of the area median price for a single- 
family residence, but in no case to exceed 175 percent of the 
Definition. 
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122 STAT. 2849 
PUBLIC LAW 110–289—JULY 30, 2008 
limitation determined under such section 305(a)(2) for the cal-
endar year in which the loan is originated for a single-family 
residence. 
SEC. 2202. COUNSELING ON MORTGAGE FORECLOSURES FOR MEM-
BERS OF THE ARMED FORCES RETURNING FROM 
SERVICE ABROAD. 
(a) IN GENERAL.—The Secretary of Defense shall develop and 
implement a program to advise members of the Armed Forces 
(including members of the National Guard and Reserve) who are 
returning from service on active duty abroad (including service 
in Operation Iraqi Freedom and Operation Enduring Freedom) 
on actions to be taken by such members to prevent or forestall 
mortgage foreclosures. 
(b) ELEMENTS.—The program required by subsection (a) shall 
include the following: 
(1) Credit counseling. 
(2) Home mortgage counseling. 
(3) Such other counseling and information as the Secretary 
considers appropriate for purposes of the program. 
(c) TIMING
OF PROVISION
OF COUNSELING.—Counseling and 
other information under the program required by subsection (a) 
shall be provided to a member of the Armed Forces covered by 
the program as soon as practicable after the return of the member 
from service as described in subsection (a). 
SEC. 2203. ENHANCEMENT OF PROTECTIONS FOR SERVICEMEMBERS 
RELATING TO MORTGAGES AND MORTGAGE FORE-
CLOSURES. 
(a) EXTENSION OF PERIOD OF PROTECTIONS AGAINST MORTGAGE 
FORECLOSURES.— 
(1) EXTENSION OF PROTECTION PERIOD.—Subsection (c) of 
section 303 of the Servicemembers Civil Relief Act (50 U.S.C. 
App. 533) is amended by striking ‘‘90 days’’ and inserting 
‘‘9 months’’. 
(2) EXTENSION
OF
STAY
OF
PROCEEDINGS
PERIOD.—Sub-
section (b) of such section is amended by striking ‘‘90 days’’ 
and inserting ‘‘9 months’’. 
(b) TREATMENT OF MORTGAGES AS OBLIGATIONS SUBJECT TO 
INTEREST RATE LIMITATION.—Section 207 of the Servicemembers 
Civil Relief Act (50 U.S.C. App. 527) is amended— 
(1) in subsection (a)(1), by striking ‘‘in excess of 6 percent’’ 
the second place it appears and all that follows and inserting 
‘‘in excess of 6 percent— 
‘‘(A) during the period of military service and one year 
thereafter, in the case of an obligation or liability consisting 
of a mortgage, trust deed, or other security in the nature 
of a mortgage; or 
‘‘(B) during the period of military service, in the case 
of any other obligation or liability.’’; and 
(2) by striking subsection (d) and inserting the following 
new subsection: 
‘‘(d) DEFINITIONS.—In this section: 
‘‘(1) INTEREST.—The term ‘interest’ includes service charges, 
renewal charges, fees, or any other charges (except bona fide 
insurance) with respect to an obligation or liability. 
10 USC 992 
note. 
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122 STAT. 2850 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) OBLIGATION
OR
LIABILITY.—The term ‘obligation or 
liability’ includes an obligation or liability consisting of a mort-
gage, trust deed, or other security in the nature of a mortgage.’’. 
(c) EFFECTIVE DATE; SUNSET.— 
(1) EFFECTIVE DATE.—The amendment made by subsection 
(a) shall take effect on the date of enactment of this Act. 
(2) SUNSET.—The amendments made by subsection (a) shall 
expire on December 31, 2010. Effective January 1, 2011, the 
provisions of subsections (b) and (c) of section 303 of the 
Servicemembers Civil Relief Act, as in effect on the day before 
the date of the enactment of this Act, are hereby revived. 
TITLE 
III—EMERGENCY 
ASSISTANCE 
FOR THE REDEVELOPMENT OF ABAN-
DONED AND FORECLOSED HOMES 
SEC. 2301. EMERGENCY ASSISTANCE FOR THE REDEVELOPMENT OF 
ABANDONED AND FORECLOSED HOMES. 
(a) DIRECT APPROPRIATIONS.—There are appropriated out of 
any money in the Treasury not otherwise appropriated for the 
fiscal year 2008, $4,000,000,000, to remain available until expended, 
for assistance to States and units of general local government 
(as such terms are defined in section 102 of the Housing and 
Community Development Act of 1974 (42 U.S.C. 5302)) for the 
redevelopment of abandoned and foreclosed upon homes and resi-
dential properties. 
(b) ALLOCATION OF APPROPRIATED AMOUNTS.— 
(1) IN GENERAL.—The amounts appropriated or otherwise 
made available to States and units of general local government 
under this section shall be allocated based on a funding formula 
established by the Secretary of Housing and Urban Develop-
ment (in this title referred to as the ‘‘Secretary’’). 
(2) FORMULA TO BE DEVISED SWIFTLY.—The funding formula 
required under paragraph (1) shall be established not later 
than 60 days after the date of enactment of this section. 
(3) CRITERIA.—The funding formula required under para-
graph (1) shall ensure that any amounts appropriated or other-
wise made available under this section are allocated to States 
and units of general local government with the greatest need, 
as such need is determined in the discretion of the Secretary 
based on— 
(A) the number and percentage of home foreclosures 
in each State or unit of general local government; 
(B) the number and percentage of homes financed by 
a subprime mortgage related loan in each State or unit 
of general local government; and 
(C) the number and percentage of homes in default 
or delinquency in each State or unit of general local govern-
ment. 
(4) DISTRIBUTION.—Amounts appropriated or otherwise 
made available under this section shall be distributed according 
to the funding formula established by the Secretary under 
paragraph (1) not later than 30 days after the establishment 
of such formula. 
(c) USE OF FUNDS.— 
Deadline. 
Deadline. 
State and 
local 
governments. 
42 USC 5301 
note. 
50 USC app. 533 
note. 
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122 STAT. 2851 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) IN GENERAL.—Any State or unit of general local govern-
ment that receives amounts pursuant to this section shall, 
not later than 18 months after the receipt of such amounts, 
use such amounts to purchase and redevelop abandoned and 
foreclosed homes and residential properties. 
(2) PRIORITY.—Any State or unit of general local govern-
ment that receives amounts pursuant to this section shall in 
distributing such amounts give priority emphasis and consider-
ation to those metropolitan areas, metropolitan cities, urban 
areas, rural areas, low- and moderate-income areas, and other 
areas with the greatest need, including those— 
(A) with the greatest percentage of home foreclosures; 
(B) with the highest percentage of homes financed 
by a subprime mortgage related loan; and 
(C) identified by the State or unit of general local 
government as likely to face a significant rise in the rate 
of home foreclosures. 
(3) ELIGIBLE USES.—Amounts made available under this 
section may be used to— 
(A) establish financing mechanisms for purchase and 
redevelopment of foreclosed upon homes and residential 
properties, including such mechanisms as soft-seconds, loan 
loss reserves, and shared-equity loans for low- and mod-
erate-income homebuyers; 
(B) purchase and rehabilitate homes and residential 
properties that have been abandoned or foreclosed upon, 
in order to sell, rent, or redevelop such homes and prop-
erties; 
(C) establish land banks for homes that have been 
foreclosed upon; 
(D) demolish blighted structures; and 
(E) redevelop demolished or vacant properties. 
(d) LIMITATIONS.— 
(1) ON PURCHASES.—Any purchase of a foreclosed upon 
home or residential property under this section shall be at 
a discount from the current market appraised value of the 
home or property, taking into account its current condition, 
and such discount shall ensure that purchasers are paying 
below-market value for the home or property. 
(2) REHABILITATION.—Any rehabilitation of a foreclosed- 
upon home or residential property under this section shall 
be to the extent necessary to comply with applicable laws, 
codes, and other requirements relating to housing safety, 
quality, and habitability, in order to sell, rent, or redevelop 
such homes and properties. Rehabilitation may include 
improvements to increase the energy efficiency or conservation 
of such homes and properties or provide a renewable energy 
source or sources for such homes and properties. 
(3) SALE OF HOMES.—If an abandoned or foreclosed upon 
home or residential property is purchased, redeveloped, or 
otherwise sold to an individual as a primary residence, then 
such sale shall be in an amount equal to or less than the 
cost to acquire and redevelop or rehabilitate such home or 
property up to a decent, safe, and habitable condition. 
(4) REINVESTMENT OF PROFITS.— 
(A) PROFITS FROM SALES, RENTALS, AND REDEVELOP-
MENT.— 
Discounts. 
Urban and 
rural areas. 
Deadline. 
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122 STAT. 2852 
PUBLIC LAW 110–289—JULY 30, 2008 
(i) 5-YEAR REINVESTMENT PERIOD.—During the 5- 
year period following the date of enactment of this 
Act, any revenue generated from the sale, rental, 
redevelopment, rehabilitation, or any other eligible use 
that is in excess of the cost to acquire and redevelop 
(including reasonable development fees) or rehabilitate 
an abandoned or foreclosed upon home or residential 
property shall be provided to and used by the State 
or unit of general local government in accordance with, 
and in furtherance of, the intent and provisions of 
this section. 
(ii) DEPOSITS IN THE TREASURY.— 
(I) PROFITS.—Upon the expiration of the 5- 
year period set forth under clause (i), any revenue 
generated from the sale, rental, redevelopment, 
rehabilitation, or any other eligible use that is 
in excess of the cost to acquire and redevelop 
(including 
reasonable 
development 
fees) 
or 
rehabilitate an abandoned or foreclosed upon home 
or residential property shall be deposited in the 
Treasury of the United States as miscellaneous 
receipts, unless the Secretary approves a request 
to use the funds for purposes under this Act. 
(II) OTHER AMOUNTS.—Upon the expiration of 
the 5-year period set forth under clause (i), any 
other revenue not described under subclause (I) 
generated from the sale, rental, redevelopment, 
rehabilitation, or any other eligible use of an aban-
doned or foreclosed upon home or residential prop-
erty shall be deposited in the Treasury of the 
United States as miscellaneous receipts. 
(B) OTHER REVENUES.—Any revenue generated under 
subparagraphs (A), (C) or (D) of subsection (c)(3) shall 
be provided to and used by the State or unit of general 
local government in accordance with, and in furtherance 
of, the intent and provisions of this section. 
(e) RULES OF CONSTRUCTION.— 
(1) IN
GENERAL.—Except as otherwise provided by this 
section, amounts appropriated, revenues generated, or amounts 
otherwise made available to States and units of general local 
government under this section shall be treated as though such 
funds were community development block grant funds under 
title I of the Housing and Community Development Act of 
1974 (42 U.S.C. 5301 et seq.). 
(2) NO MATCH.—No matching funds shall be required in 
order for a State or unit of general local government to receive 
any amounts under this section. 
(f) AUTHORITY TO SPECIFY ALTERNATIVE REQUIREMENTS.— 
(1) IN
GENERAL.—In administering any amounts appro-
priated or otherwise made available under this section, the 
Secretary may specify alternative requirements to any provision 
under title I of the Housing and Community Development 
Act of 1974 (except for those related to fair housing, non-
discrimination, labor standards, and the environment) in 
accordance with the terms of this section and for the sole 
purpose of expediting the use of such funds. 
State and local 
governments. 
State and local 
governments. 
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122 STAT. 2853 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) NOTICE.—The Secretary shall provide written notice 
of its intent to exercise the authority to specify alternative 
requirements under paragraph (1) to the Committee on 
Banking, Housing and Urban Affairs of the Senate and the 
Committee on Financial Services of the House of Representa-
tives not later than 10 business days before such exercise 
of authority is to occur. 
(3) LOW AND MODERATE INCOME REQUIREMENT.— 
(A) IN GENERAL.—Notwithstanding the authority of the 
Secretary under paragraph (1)— 
(i) all of the funds appropriated or otherwise made 
available under this section shall be used with respect 
to individuals and families whose income does not 
exceed 120 percent of area median income; and 
(ii) not less than 25 percent of the funds appro-
priated or otherwise made available under this section 
shall be used for the purchase and redevelopment of 
abandoned or foreclosed upon homes or residential 
properties that will be used to house individuals or 
families whose incomes do not exceed 50 percent of 
area median income. 
(B) RECURRENT REQUIREMENT.—The Secretary shall, 
by rule or order, ensure, to the maximum extent practicable 
and for the longest feasible term, that the sale, rental, 
or redevelopment of abandoned and foreclosed upon homes 
and residential properties under this section remain afford-
able to individuals or families described in subparagraph 
(A). 
(g) PERIODIC AUDITS.—In consultation with the Secretary of 
Housing and Urban Development, the Comptroller General of the 
United States shall conduct periodic audits to ensure that funds 
appropriated, made available, or otherwise distributed under this 
section are being used in a manner consistent with the criteria 
provided in this section. 
SEC. 2302. NATIONWIDE DISTRIBUTION OF RESOURCES. 
Notwithstanding any other provision of this Act or the amend-
ments made by this Act, each State shall receive not less than 
0.5 percent of funds made available under section 2301 (relating 
to emergency assistance for the redevelopment of abandoned and 
foreclosed homes). 
SEC. 2303. LIMITATION ON USE OF FUNDS WITH RESPECT TO EMINENT 
DOMAIN. 
No State or unit of general local government may use any 
amounts received pursuant to section 2301 to fund any project 
that seeks to use the power of eminent domain, unless eminent 
domain is employed only for a public use: Provided, That for pur-
poses of this section, public use shall not be construed to include 
economic development that primarily benefits private entities. 
SEC. 2304. LIMITATION ON DISTRIBUTION OF FUNDS. 
(a) IN GENERAL.—None of the funds made available under 
this title or title IV shall be distributed to— 
(1) an organization which has been indicted for a violation 
under Federal law relating to an election for Federal office; 
or 
(2) an organization which employs applicable individuals. 
42 USC 5301 
note. 
42 USC 5301 
note. 
42 USC 5301 
note. 
Regulations. 
Orders. 
Deadline. 
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122 STAT. 2854 
PUBLIC LAW 110–289—JULY 30, 2008 
(b) APPLICABLE INDIVIDUALS DEFINED.—In this section, the term 
‘‘applicable individual’’ means an individual who— 
(1) is— 
(A) employed by the organization in a permanent or 
temporary capacity; 
(B) contracted or retained by the organization; or 
(C) acting on behalf of, or with the express or apparent 
authority of, the organization; and 
(2) has been indicted for a violation under Federal law 
relating to an election for Federal office. 
SEC. 2305. COUNSELING INTERMEDIARIES. 
Notwithstanding any other provision of this Act, the amount 
appropriated 
under 
section 
2301(a) 
of 
this 
Act 
shall 
be 
$3,920,000,000 and the amount appropriated under section 2401 
of this Act shall be $180,000,000: Provided, That of the amount 
appropriated under section 2401 of this Act pursuant to this section, 
not less than 15 percent shall be provided to counseling organiza-
tions that target counseling services regarding loss mitigation to 
minority and low-income homeowners or provide such services in 
neighborhoods with high concentrations of minority and low-income 
homeowners: Provided further, That of amounts appropriated under 
such section 2401 $30,000,000 shall be used by the Neighborhood 
Reinvestment Corporation (referred to in this section as the ‘‘NRC’’) 
to make grants to counseling intermediaries approved by the 
Department of Housing and Urban Development or the NRC to 
hire attorneys to assist homeowners who have legal issues directly 
related to the homeowner’s foreclosure, delinquency or short sale. 
Such attorneys shall be capable of assisting homeowners of owner- 
occupied homes with mortgages in default, in danger of default, 
or subject to or at risk of foreclosure and who have legal issues 
that cannot be handled by counselors already employed by such 
intermediaries: Provided further, That of the amounts provided 
for in the prior provisos the NRC shall give priority consideration 
to counseling intermediaries and legal organizations that (1) provide 
legal assistance in the 100 metropolitan statistical areas (as defined 
by the Director of the Office of Management and Budget) with 
the highest home foreclosure rates, and (2) have the capacity to 
begin using the financial assistance within 90 days after receipt 
of the assistance: Provided further, That no funds provided under 
this Act shall be used to provide, obtain, or arrange on behalf 
of a homeowner, legal representation involving or for the purposes 
of civil litigation: Provided further, That the NRC, in awarding 
counseling grants under section 2401 of this Act, may consider, 
where appropriate, whether the entity has implemented a written 
plan for providing in-person counseling and for making contact, 
including personal contact, with defaulted mortgagors, for the pur-
pose of providing counseling or providing information about avail-
able counseling. 
TITLE IV—HOUSING COUNSELING 
RESOURCES 
SEC. 2401. HOUSING COUNSELING RESOURCES. 
There are appropriated out of any money in the Treasury 
not otherwise appropriated for the fiscal year 2008, for an additional 
Appropriations 
authorization. 
Legal assistance. 
Deadline. 
Grants. 
Disadvantaged 
persons. 
42 USC 5301 
note. 
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122 STAT. 2855 
PUBLIC LAW 110–289—JULY 30, 2008 
amount for the ‘‘Neighborhood Reinvestment Corporation—Payment 
to the Neighborhood Reinvestment Corporation’’ $100,000,000, to 
remain available until December 31, 2008, for foreclosure mitigation 
activities under the terms and conditions contained in the second 
undesignated paragraph (beginning with the phrase ‘‘For an addi-
tional amount’’) under the heading ‘‘Neighborhood Reinvestment 
Corporation—Payment to the Neighborhood Reinvestment Corpora-
tion’’ of Public Law 110–161. 
SEC. 2402. CREDIT COUNSELING. 
(a) IN
GENERAL.—Entities approved by the Neighborhood 
Reinvestment Corporation or the Secretary and State housing 
finance entities receiving funds under this title shall work to iden-
tify and coordinate with non-profit organizations operating national 
or statewide toll-free foreclosure prevention hotlines, including those 
that— 
(1) serve as a consumer referral source and data repository 
for borrowers experiencing some form of delinquency or fore-
closure; 
(2) connect callers with local housing counseling agencies 
approved by the Neighborhood Reinvestment Corporation or 
the Secretary to assist with working out a positive resolution 
to their mortgage delinquency or foreclosure; or 
(3) facilitate or offer free assistance to help homeowners 
to understand their options, negotiate solutions, and find the 
best resolution for their particular circumstances. 
TITLE V—MORTGAGE DISCLOSURE 
IMPROVEMENT ACT 
SEC. 2501. SHORT TITLE. 
This title may be cited as the ‘‘Mortgage Disclosure Improve-
ment Act of 2008’’. 
SEC. 2502. ENHANCED MORTGAGE LOAN DISCLOSURES. 
(a) TRUTH IN LENDING ACT DISCLOSURES.—Section 128(b)(2) 
of the Truth in Lending Act (15 U.S.C. 1638(b)(2)) is amended— 
(1) by inserting ‘‘(A)’’ before ‘‘In the’’; 
(2) by striking ‘‘a residential mortgage transaction, as 
defined in section 103(w)’’ and inserting ‘‘any extension of credit 
that is secured by the dwelling of a consumer’’; 
(3) by striking ‘‘before the credit is extended, or’’ and 
inserting ‘‘and’’; 
(4) by inserting ‘‘, which shall be at least 7 business days 
before consummation of the transaction’’ after ‘‘written applica-
tion’’; 
(5) by striking ‘‘, whichever is earlier’’; and 
(6) by striking ‘‘If the’’ and all that follows through the 
end of the paragraph and inserting the following: 
‘‘(B) In the case of an extension of credit that is secured 
by the dwelling of a consumer, the disclosures provided under 
subparagraph (A), shall be in addition to the other disclosures 
required by subsection (a), and shall— 
‘‘(i) state in conspicuous type size and format, the 
following: ‘You are not required to complete this agreement 
Creditors. 
15 USC 1601 
note. 
Mortgage 
Disclosure 
Improvement Act 
of 2008. 
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122 STAT. 2856 
PUBLIC LAW 110–289—JULY 30, 2008 
merely because you have received these disclosures or 
signed a loan application.’; and 
‘‘(ii) be provided in the form of final disclosures at 
the time of consummation of the transaction, in the form 
and manner prescribed by this section. 
‘‘(C) In the case of an extension of credit that is secured 
by the dwelling of a consumer, under which the annual rate 
of interest is variable, or with respect to which the regular 
payments may otherwise be variable, in addition to the other 
disclosures required by subsection (a), the disclosures provided 
under this subsection shall do the following: 
‘‘(i) Label the payment schedule as follows: ‘Payment 
Schedule: Payments Will Vary Based on Interest Rate 
Changes’. 
‘‘(ii) State in conspicuous type size and format examples 
of adjustments to the regular required payment on the 
extension of credit based on the change in the interest 
rates specified by the contract for such extension of credit. 
Among the examples required to be provided under this 
clause is an example that reflects the maximum payment 
amount of the regular required payments on the extension 
of credit, based on the maximum interest rate allowed 
under the contract, in accordance with the rules of the 
Board. Prior to issuing any rules pursuant to this clause, 
the Board shall conduct consumer testing to determine 
the appropriate format for providing the disclosures 
required under this subparagraph to consumers so that 
such disclosures can be easily understood, including the 
fact that the initial regular payments are for a specific 
time period that will end on a certain date, that payments 
will adjust afterwards potentially to a higher amount, and 
that there is no guarantee that the borrower will be able 
to refinance to a lower amount. 
‘‘(D) In any case in which the disclosure statement under 
subparagraph (A) contains an annual percentage rate of interest 
that is no longer accurate, as determined under section 107(c), 
the creditor shall furnish an additional, corrected statement 
to the borrower, not later than 3 business days before the 
date of consummation of the transaction. 
‘‘(E) The consumer shall receive the disclosures required 
under this paragraph before paying any fee to the creditor 
or other person in connection with the consumer’s application 
for an extension of credit that is secured by the dwelling of 
a consumer. If the disclosures are mailed to the consumer, 
the consumer is considered to have received them 3 business 
days after they are mailed. A creditor or other person may 
impose a fee for obtaining the consumer’s credit report before 
the consumer has received the disclosures under this para-
graph, provided the fee is bona fide and reasonable in amount. 
‘‘(F) WAIVER OF TIMELINESS OF DISCLOSURES.—To expedite 
consummation of a transaction, if the consumer determines 
that the extension of credit is needed to meet a bona fide 
personal financial emergency, the consumer may waive or 
modify the timing requirements for disclosures under subpara-
graph (A), provided that— 
‘‘(i) the term ‘bona fide personal emergency’ may be 
further defined in regulations issued by the Board; 
Definition. 
Regulations. 
Deadline. 
Consumer 
testing. 
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122 STAT. 2857 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) the consumer provides to the creditor a dated, 
written statement describing the emergency and specifi-
cally waiving or modifying those timing requirements, 
which statement shall bear the signature of all consumers 
entitled to receive the disclosures required by this para-
graph; and 
‘‘(iii) the creditor provides to the consumers at or before 
the time of such waiver or modification, the final disclo-
sures required by paragraph (1). 
‘‘(G) The requirements of subparagraphs (B), (C), (D) and 
(E) shall not apply to extensions of credit relating to plans 
described in section 101(53D) of title 11, United States Code.’’. 
(b) CIVIL LIABILITY.—Section 130(a) of the Truth in Lending 
Act (15 U.S.C. 1640(a)) is amended— 
(1) in paragraph (2)(A)(iii), by striking ‘‘not less than $200 
or greater than $2,000’’ and inserting ‘‘not less than $400 
or greater than $4,000’’; and 
(2) in the penultimate sentence of the undesignated matter 
following paragraph (4)— 
(A) by inserting ‘‘or section 128(b)(2)(C)(ii),’’ after 
‘‘128(a),’’; and 
(B) by inserting ‘‘or section 128(b)(2)(C)(ii)’’ before the 
period. 
(c) EFFECTIVE DATES.— 
(1) GENERAL DISCLOSURES.—Except as provided in para-
graph (2), the amendments made by subsection (a) shall become 
effective 12 months after the date of enactment of this Act. 
(2) VARIABLE INTEREST RATES.—Subparagraph (C) of section 
128(b)(2) of the Truth in Lending Act (15 U.S.C. 1638(b)(2)(C)), 
as added by subsection (a) of this section, shall become effective 
on the earlier of— 
(A) the compliance date established by the Board for 
such purpose, by regulation; or 
(B) 30 months after the date of enactment of this 
Act. 
SEC. 2503. COMMUNITY DEVELOPMENT INVESTMENT AUTHORITY FOR 
DEPOSITORY INSTITUTIONS. 
(a) NATIONAL BANKS.—The first sentence of the paragraph des-
ignated as the ‘‘Eleventh’’ of section 5136 of the Revised Statutes 
of the United States (12 U.S.C. 24) is amended by striking ‘‘promotes 
the public welfare by benefitting primarily’’ and inserting ‘‘is 
designed primarily to promote the public welfare, including the 
welfare of’’. 
(b) STATE MEMBER BANKS.—The first sentence of the 23rd 
paragraph of section 9 of the Federal Reserve Act (12 U.S.C. 338a) 
is amended by striking ‘‘promotes the public welfare by benefitting 
primarily’’ and inserting ‘‘is designed primarily to promote the 
public welfare, including the welfare of’’. 
15 USC 1638 
note. 
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122 STAT. 2858 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE VI—VETERANS HOUSING 
MATTERS 
SEC. 2601. HOME IMPROVEMENTS AND STRUCTURAL ALTERATIONS 
FOR TOTALLY DISABLED MEMBERS OF THE ARMED 
FORCES BEFORE DISCHARGE OR RELEASE FROM THE 
ARMED FORCES. 
Section 1717 of title 38, United States Code, is amended by 
adding at the end the following new subsection: 
‘‘(d)(1) In the case of a member of the Armed Forces who, 
as determined by the Secretary, has a disability permanent in 
nature incurred or aggravated in the line of duty in the active 
military, naval, or air service, the Secretary may furnish improve-
ments and structural alterations for such member for such disability 
or as otherwise described in subsection (a)(2) while such member 
is hospitalized or receiving outpatient medical care, services, or 
treatment for such disability if the Secretary determines that such 
member is likely to be discharged or released from the Armed 
Forces for such disability. 
‘‘(2) The furnishing of improvements and alterations under 
paragraph (1) in connection with the furnishing of medical services 
described in subparagraph (A) or (B) of subsection (a)(2) shall 
be subject to the limitation specified in the applicable subpara-
graph.’’. 
SEC. 2602. ELIGIBILITY FOR SPECIALLY ADAPTED HOUSING BENEFITS 
AND ASSISTANCE FOR MEMBERS OF THE ARMED FORCES 
WITH SERVICE-CONNECTED DISABILITIES AND INDIVID-
UALS RESIDING OUTSIDE THE UNITED STATES. 
(a) ELIGIBILITY.—Chapter 21 of title 38, United States Code, 
is amended by inserting after section 2101 the following new section: 
‘‘§ 2101A. Eligibility for benefits and assistance: members of 
the Armed Forces with service-connected disabil-
ities; individuals residing outside the United 
States 
‘‘(a) MEMBERS WITH SERVICE-CONNECTED DISABILITIES.—(1) 
The Secretary may provide assistance under this chapter to a 
member of the Armed Forces serving on active duty who is suffering 
from a disability that meets applicable criteria for benefits under 
this chapter if the disability is incurred or aggravated in line 
of duty in the active military, naval, or air service. Such assistance 
shall be provided to the same extent as assistance is provided 
under this chapter to veterans eligible for assistance under this 
chapter and subject to the same requirements as veterans under 
this chapter. 
‘‘(2) For purposes of this chapter, any reference to a veteran 
or eligible individual shall be treated as a reference to a member 
of the Armed Forces described in subsection (a) who is similarly 
situated to the veteran or other eligible individual so referred 
to. 
‘‘(b) BENEFITS AND ASSISTANCE FOR INDIVIDUALS RESIDING OUT-
SIDE THE UNITED STATES.—(1) Subject to paragraph (2), the Sec-
retary may, at the Secretary’s discretion, provide benefits and 
assistance under this chapter (other than benefits under section 
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122 STAT. 2859 
PUBLIC LAW 110–289—JULY 30, 2008 
2106 of this title) to any individual otherwise eligible for such 
benefits and assistance who resides outside the United States. 
‘‘(2) The Secretary may provide benefits and assistance to an 
individual under paragraph (1) only if— 
‘‘(A) the country or political subdivision in which the 
housing or residence involved is or will be located permits 
the individual to have or acquire a beneficial property interest 
(as determined by the Secretary) in such housing or residence; 
and 
‘‘(B) the individual has or will acquire a beneficial property 
interest (as so determined) in such housing or residence. 
‘‘(c) REGULATIONS.—Benefits and assistance under this chapter 
by reason of this section shall be provided in accordance with 
such regulations as the Secretary may prescribe.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) REPEAL OF SUPERSEDED AUTHORITY.—Section 2101 of 
title 38, United States Code, is amended— 
(A) by striking subsection (c); and 
(B) by redesignating subsection (d) as subsection (c). 
(2) LIMITATIONS ON ASSISTANCE.—Section 2102 of title 38, 
United States Code, is amended— 
(A) in subsection (a)— 
(i) by striking ‘‘veteran’’ each place it appears and 
inserting ‘‘individual’’; and 
(ii) in paragraph (3), by striking ‘‘veteran’s’’ and 
inserting ‘‘individual’s’’; 
(B) in subsection (b)(1), by striking ‘‘a veteran’’ and 
inserting ‘‘an individual’’; 
(C) in subsection (c)— 
(i) by striking ‘‘a veteran’’ and inserting ‘‘an indi-
vidual’’; and 
(ii) by striking ‘‘the veteran’’ each place it appears 
and inserting ‘‘the individual’’; and 
(D) in subsection (d), by striking ‘‘a veteran’’ each place 
it appears and inserting ‘‘an individual’’. 
(3) ASSISTANCE
FOR
INDIVIDUALS
TEMPORARILY
RESIDING 
IN HOUSING OF FAMILY MEMBER.—Section 2102A of title 38, 
United States Code, is amended— 
(A) by striking ‘‘veteran’’ each place it appears (other 
than in subsection (b)) and inserting ‘‘individual’’; 
(B) in subsection (a), by striking ‘‘veteran’s’’ each place 
it appears and inserting ‘‘individual’s’’; and 
(C) in subsection (b), by striking ‘‘a veteran’’ each place 
it appears and inserting ‘‘an individual’’. 
(4) FURNISHING
OF
PLANS
AND
SPECIFICATIONS.—Section 
2103 of title 38, United States Code, is amended by striking 
‘‘veterans’’ both places it appears and inserting ‘‘individuals’’. 
(5) CONSTRUCTION OF BENEFITS.—Section 2104 of title 38, 
United States Code, is amended— 
(A) in subsection (a), by striking ‘‘veteran’’ each place 
it appears and inserting ‘‘individual’’; and 
(B) in subsection (b)— 
(i) in the first sentence, by striking ‘‘A veteran’’ 
and inserting ‘‘An individual’’; 
(ii) in the second sentence, by striking ‘‘a veteran’’ 
and inserting ‘‘an individual’’; and 
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122 STAT. 2860 
PUBLIC LAW 110–289—JULY 30, 2008 
(iii) by striking ‘‘such veteran’’ each place it 
appears and inserting ‘‘such individual’’. 
(6) VETERANS’ MORTGAGE LIFE INSURANCE.—Section 2106 
of title 38, United States Code, is amended— 
(A) in subsection (a)— 
(i) by striking ‘‘any eligible veteran’’ and inserting 
‘‘any eligible individual’’; and 
(ii) by striking ‘‘the veterans’ ’’ and inserting ‘‘the 
individual’s’’; 
(B) in subsection (b), by striking ‘‘an eligible veteran’’ 
and inserting ‘‘an eligible individual’’; 
(C) in subsection (e), by striking ‘‘an eligible veteran’’ 
and inserting ‘‘an individual’’; 
(D) in subsection (h), by striking ‘‘each veteran’’ and 
inserting ‘‘each individual’’; 
(E) in subsection (i), by striking ‘‘the veteran’s’’ each 
place it appears and inserting ‘‘the individual’s’’; 
(F) by striking ‘‘the veteran’’ each place it appears 
and inserting ‘‘the individual’’; and 
(G) by striking ‘‘a veteran’’ each place it appears and 
inserting ‘‘an individual’’. 
(7) HEADING
AMENDMENTS.—(A) The heading of section 
2101 of title 38, United States Code, is amended to read as 
follows: 
‘‘§ 2101. Acquisition and adaptation of housing: eligible vet-
erans’’. 
(B) The heading of section 2102A of such title is amended 
to read as follows: 
‘‘§ 2102A. Assistance for individuals residing temporarily in 
housing owned by a family member’’. 
(8) CLERICAL AMENDMENTS.—The table of sections at the 
beginning of chapter 21 of title 38, United States Code, is 
amended— 
(A) by striking the item relating to section 2101 and 
inserting the following new item: 
‘‘2101. Acquisition and adaptation of housing: eligible veterans.’’; 
(B) by inserting after the item relating to section 2101, 
as so amended, the following new item: 
‘‘2101A. Eligibility for benefits and assistance: members of the Armed Forces with 
service-connected disabilities; individuals residing outside the United 
States.’’; 
and 
(C) by striking the item relating to section 2102A and 
inserting the following new item: 
‘‘2102A. Assistance for individuals residing temporarily in housing owned by a fam-
ily member.’’. 
SEC. 2603. SPECIALLY ADAPTED HOUSING ASSISTANCE FOR INDIVID-
UALS WITH SEVERE BURN INJURIES. 
Section 2101 of title 38, United States Code, is amended— 
(1) in subsection (a)(2), by adding at the end the following 
new subparagraph: 
‘‘(E) The disability is due to a severe burn injury (as deter-
mined pursuant to regulations prescribed by the Secretary).’’; 
and 
(2) in subsection (b)(2)— 
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122 STAT. 2861 
PUBLIC LAW 110–289—JULY 30, 2008 
(A) by striking ‘‘either’’ and inserting ‘‘any’’; and 
(B) by adding at the end the following new subpara-
graph: 
‘‘(C) The disability is due to a severe burn injury (as so 
determined).’’. 
SEC. 2604. EXTENSION OF ASSISTANCE FOR INDIVIDUALS RESIDING 
TEMPORARILY 
IN 
HOUSING 
OWNED 
BY 
A 
FAMILY 
MEMBER. 
Section 2102A(e) of title 38, United States Code, is amended 
by striking ‘‘after the end of the five-year period that begins on 
the date of the enactment of the Veterans’ Housing Opportunity 
and Benefits Improvement Act of 2006’’ and inserting ‘‘after 
December 31, 2011’’. 
SEC. 2605. INCREASE IN SPECIALLY ADAPTED HOUSING BENEFITS FOR 
DISABLED VETERANS. 
(a) IN GENERAL.—Section 2102 of title 38, United States Code, 
is amended— 
(1) in subsection (b)(2), by striking ‘‘$10,000’’ and inserting 
‘‘$12,000’’; 
(2) in subsection (d)— 
(A) in paragraph (1), by striking ‘‘$50,000’’ and 
inserting ‘‘$60,000’’; and 
(B) in paragraph (2), by striking ‘‘$10,000’’ and 
inserting ‘‘$12,000’’; and 
(3) by adding at the end the following new subsection: 
‘‘(e)(1) Effective on October 1 of each year (beginning in 2009), 
the Secretary shall increase the amounts described in subsection 
(b)(2) and paragraphs (1) and (2) of subsection (d) in accordance 
with this subsection. 
‘‘(2) The increase in amounts under paragraph (1) to take 
effect on October 1 of a year shall be by an amount of such 
amounts equal to the percentage by which— 
‘‘(A) the residential home cost-of-construction index for the 
preceding calendar year, exceeds 
‘‘(B) the residential home cost-of-construction index for the 
year preceding the year described in subparagraph (A). 
‘‘(3) The Secretary shall establish a residential home cost-of- 
construction index for the purposes of this subsection. The index 
shall reflect a uniform, national average change in the cost of 
residential home construction, determined on a calendar year basis. 
The Secretary may use an index developed in the private sector 
that the Secretary determines is appropriate for purposes of this 
subsection.’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall take effect on July 1, 2008, and shall apply with respect 
to payments made in accordance with section 2102 of title 38, 
United States Code, on or after that date. 
SEC. 2606. REPORT ON SPECIALLY ADAPTED HOUSING FOR DISABLED 
INDIVIDUALS. 
(a) IN GENERAL.—Not later than December 31, 2008, the Sec-
retary of Veterans Affairs shall submit to the Committee on Vet-
erans’ Affairs of the Senate and the Committee on Veterans’ Affairs 
of the House of Representatives a report that contains an assess-
ment of the adequacy of the authorities available to the Secretary 
under law to assist eligible disabled individuals in acquiring— 
Deadline. 
38 USC 2102 
note. 
Effective date. 
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122 STAT. 2862 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) suitable housing units with special fixtures or movable 
facilities required for their disabilities, and necessary land 
therefor; 
(2) such adaptations to their residences as are reasonably 
necessary because of their disabilities; and 
(3) residences already adapted with special features deter-
mined by the Secretary to be reasonably necessary as a result 
of their disabilities. 
(b) FOCUS ON PARTICULAR DISABILITIES.—The report required 
by subsection (a) shall set forth a specific assessment of the needs 
of— 
(1) veterans who have disabilities that are not described 
in subsections (a)(2) and (b)(2) of section 2101 of title 38, 
United States Code; and 
(2) other disabled individuals eligible for specially adapted 
housing under chapter 21 of such title by reason of section 
2101A of such title (as added by section 2602(a) of this Act) 
who have disabilities that are not described in such subsections. 
SEC. 2607. REPORT ON SPECIALLY ADAPTED HOUSING ASSISTANCE 
FOR INDIVIDUALS WHO RESIDE IN HOUSING OWNED BY 
A FAMILY MEMBER ON PERMANENT BASIS. 
Not later than December 31, 2008, the Secretary of Veterans 
Affairs shall submit to the Committee on Veterans’ Affairs of the 
Senate and the Committee on Veterans’ Affairs of the House of 
Representatives a report on the advisability of providing assistance 
under section 2102A of title 38, United States Code, to veterans 
described in subsection (a) of such section, and to members of 
the Armed Forces covered by such section 2102A by reason of 
section 2101A of title 38, United States Code (as added by section 
2602(a) of this Act), who reside with family members on a perma-
nent basis. 
SEC. 2608. DEFINITION OF ANNUAL INCOME FOR PURPOSES OF SEC-
TION 8 AND OTHER PUBLIC HOUSING PROGRAMS. 
Section 3(b)(4) of the United States Housing Act of 1937 (42 
U.S.C. 1437a(3)(b)(4)) is amended by inserting ‘‘or any deferred 
Department of Veterans Affairs disability benefits that are received 
in a lump sum amount or in prospective monthly amounts’’ before 
‘‘may not be considered’’. 
SEC. 2609. PAYMENT OF TRANSPORTATION OF BAGGAGE AND HOUSE-
HOLD EFFECTS FOR MEMBERS OF THE ARMED FORCES 
WHO RELOCATE DUE TO FORECLOSURE OF LEASED 
HOUSING. 
Section 406 of title 37, United States Code, is amended— 
(1) by redesignating subsections (k) and (l) as subsections 
(l) and (m), respectively; and 
(2) by inserting after subsection (j) the following new sub-
section (k): 
‘‘(k) A member of the armed forces who relocates from leased 
or rental housing by reason of the foreclosure of such housing 
is entitled to transportation of baggage and household effects under 
subsection (b)(1) in the same manner, and subject to the same 
conditions and limitations, as similarly circumstanced members 
entitled to transportation of baggage and household effects under 
that subsection.’’. 
Deadline. 
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122 STAT. 2863 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE VII—SMALL PUBLIC HOUSING 
AUTHORITIES 
PAPERWORK 
REDUC-
TION ACT 
SEC. 2701. SHORT TITLE. 
This title may be cited as the ‘‘Small Public Housing Authorities 
Paperwork Reduction Act’’. 
SEC. 2702. PUBLIC HOUSING AGENCY PLANS FOR CERTAIN QUALIFIED 
PUBLIC HOUSING AGENCIES. 
(a) IN GENERAL.—Section 5A(b) of the United States Housing 
Act of 1937 (42 U.S.C. 1437c–1(b)) is amended by adding at the 
end the following: 
‘‘(3) EXEMPTION OF CERTAIN PHAS FROM FILING REQUIRE-
MENT.— 
‘‘(A) IN GENERAL.—Notwithstanding paragraph (1) or 
any other provision of this Act— 
‘‘(i) the requirement under paragraph (1) shall not 
apply to any qualified public housing agency; and 
‘‘(ii) except as provided in subsection (e)(4)(B), any 
reference in this section or any other provision of law 
to a ‘public housing agency’ shall not be considered 
to refer to any qualified public housing agency, to 
the extent such reference applies to the requirement 
to submit an annual public housing agency plan under 
this subsection. 
‘‘(B) CIVIL
RIGHTS
CERTIFICATION.—Notwithstanding 
that qualified public housing agencies are exempt under 
subparagraph (A) from the requirement under this section 
to prepare and submit an annual public housing plan, 
each qualified public housing agency shall, on an annual 
basis, make the certification described in paragraph (16) 
of subsection (d), except that for purposes of such qualified 
public housing agencies, such paragraph shall be applied 
by substituting ‘the public housing program of the agency’ 
for ‘the public housing agency plan’. 
‘‘(C) DEFINITION.—For purposes of this section, the 
term ‘qualified public housing agency’ means a public 
housing agency that meets the following requirements: 
‘‘(i) The sum of (I) the number of public housing 
dwelling units administered by the agency, and (II) 
the number of vouchers under section 8(o) of the United 
States Housing Act of 1937 (42 U.S.C. 1437f(o)) 
administered by the agency, is 550 or fewer. 
‘‘(ii) The agency is not designated under section 
6(j)(2) as a troubled public housing agency, and does 
not have a failing score under the section 8 Manage-
ment Assessment Program during the prior 12 
months.’’. 
(b) RESIDENT PARTICIPATION.—Section 5A of the United States 
Housing Act of 1937 (42 U.S.C. 1437c–1) is amended— 
(1) in subsection (e), by inserting after paragraph (3) the 
following: 
‘‘(4) QUALIFIED PUBLIC HOUSING AGENCIES.— 
Applicability. 
42 USC 1437 
note. 
Small Public 
Housing 
Authorities 
Paperwork 
Reduction Act. 
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122 STAT. 2864 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) IN GENERAL.—Except as provided in subparagraph 
(B), nothing in this section may be construed to exempt 
a qualified public housing agency from the requirement 
under paragraph (1) to establish 1 or more resident 
advisory boards. Notwithstanding that qualified public 
housing agencies are exempt under subsection (b)(3)(A) 
from the requirement under this section to prepare and 
submit an annual public housing plan, each qualified public 
housing agency shall consult with, and consider the rec-
ommendations of the resident advisory boards for the 
agency, at the annual public hearing required under sub-
section (f)(5), regarding any changes to the goals, objectives, 
and policies of that agency. 
‘‘(B) APPLICABILITY OF WAIVER AUTHORITY.—Paragraph 
(3) shall apply to qualified public housing agencies, except 
that for purposes of such qualified public housing agencies, 
subparagraph (B) of such paragraph shall be applied by 
substituting ‘the functions described in the second sentence 
of paragraph (4)(A)’ for ‘the functions described in para-
graph (2)’. 
‘‘(f) PUBLIC HEARINGS.—’’; and 
(2) in subsection (f) (as so designated by the amendment 
made by paragraph (1)), by adding at the end the following: 
‘‘(5) QUALIFIED PUBLIC HOUSING AGENCIES.— 
‘‘(A) REQUIREMENT.—Notwithstanding that qualified 
public housing agencies are exempt under subsection 
(b)(3)(A) from the requirement under this section to conduct 
a public hearing regarding the annual public housing plan 
of the agency, each qualified public housing agency shall 
annually conduct a public hearing— 
‘‘(i) to discuss any changes to the goals, objectives, 
and policies of the agency; and 
‘‘(ii) to invite public comment regarding such 
changes. 
‘‘(B) AVAILABILITY OF INFORMATION AND NOTICE.—Not 
later than 45 days before the date of any hearing described 
in subparagraph (A), a qualified public housing agency 
shall— 
‘‘(i) make all information relevant to the hearing 
and any determinations of the agency regarding 
changes to the goals, objectives, and policies of the 
agency to be considered at the hearing available for 
inspection by the public at the principal office of the 
public housing agency during normal business hours; 
and 
‘‘(ii) publish a notice informing the public that— 
‘‘(I) the information is available as required 
under clause (i); and 
‘‘(II) a public hearing under subparagraph (A) 
will be conducted.’’. 
Deadline. 
Public comment. 
Establishment. 
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122 STAT. 2865 
PUBLIC LAW 110–289—JULY 30, 2008 
TITLE VIII—HOUSING PRESERVATION 
Subtitle A—Preservation Under Federal 
Housing Programs 
SEC. 2801. CLARIFICATION OF DISPOSITION OF CERTAIN PROPERTIES. 
Notwithstanding any other provision of law, subtitle A of title 
II of the Deficit Reduction Act of 2005 (12 U.S.C. 1701z-11 note) 
and the amendments made by such title shall not apply to any 
transaction regarding a multifamily real property for which— 
(1) the Secretary of Housing and Urban Development has 
received, before the date of the enactment of such Act, written 
expressions of interest in purchasing the property from both 
a city government and the housing commission of such city; 
(2) after such receipt, the Secretary acquires title to the 
property at a foreclosure sale; and 
(3) such city government and housing commission have 
resolved a previous disagreement with respect to the disposition 
of the property. 
SEC. 2802. ELIGIBILITY OF CERTAIN PROJECTS FOR ENHANCED 
VOUCHER ASSISTANCE. 
Notwithstanding any other provision of law— 
(1) the property known as The Heritage Apartments (FHA 
No. 023-44804), in Malden, Massachusetts, shall be considered 
eligible low-income housing for purposes of the eligibility of 
residents of the property for enhanced voucher assistance under 
section 8(t) of the United States Housing Act of 1937 (42 
U.S.C. 1437f(t)), pursuant to paragraph (2)(A) of section 223(f) 
of the Low-Income Housing Preservation and Resident 
Homeownership Act of 1990 (12 U.S.C. 4113(f)(2)(A)); 
(2) such residents shall receive enhanced rental housing 
vouchers upon the prepayment of the mortgage loan for the 
property under section 236 of the National Housing Act (12 
U.S.C. 1715z-1); and 
(3) the Secretary shall approve such prepayment and subse-
quent transfer of the property without any further condition, 
except that the property shall be restricted for occupancy, until 
the original maturity date of the prepaid mortgage loan, only 
by families with incomes not exceeding 80 percent of the 
adjusted median income for the area in which the property 
is located, as published by the Secretary. 
Amounts for the enhanced vouchers pursuant to this section shall 
be provided under amounts appropriated for tenant-based rental 
assistance otherwise authorized under section 8(t) of the United 
States Housing Act of 1937. 
SEC. 2803. TRANSFER OF CERTAIN RENTAL ASSISTANCE CONTRACTS. 
(a) TRANSFER.—Subject to subsection (c) and notwithstanding 
any other provision of law, the Secretary of Housing and Urban 
Development shall, at the request of the owner, transfer or 
authorize the transfer, of the contracts, restrictions, and debt 
described in subsection (b)— 
(1) on the housing that is owned or managed by Community 
Properties of Ohio Management Services LLC or an affiliate 
of Ohio Capital Corporation for Housing and located in Franklin 
Ohio. 
Public 
information. 
Massachusetts. 
Disadvantaged 
persons. 
Deadlines. 
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122 STAT. 2866 
PUBLIC LAW 110–289—JULY 30, 2008 
County, Ohio, to other properties located in Franklin County, 
Ohio; and 
(2) on the housing that is owned or managed by The 
Model Group, Inc., and located in Hamilton County, Ohio, to 
other properties located in Hamilton County, Ohio. 
(b) CONTRACTS, RESTRICTIONS, AND DEBT COVERED.—The con-
tracts, restrictions, and debt described in this subsection are as 
follows: 
(1) All or a portion of a project-based rental assistance 
housing assistance payments contract under section 8 of the 
United States Housing Act of 1937 (42 U.S.C. 1437f). 
(2) Existing Federal use restrictions, including without 
limitation 
use 
agreements, 
regulatory 
agreements, 
and 
accommodation agreements. 
(3) Any subordinate debt held by the Secretary or assigned 
and any mortgages securing such debt, all related loan and 
security documentation and obligations, and reserve and escrow 
balances. 
(c) RETENTION OF SAME NUMBER OF UNITS AND AMOUNT OF 
ASSISTANCE.—Any transfer pursuant to subsection (a) shall result 
in— 
(1) a total number of dwelling units (including units 
retained by the owners and units transferred) covered by assist-
ance described in subsection (b)(1) after the transfer remaining 
the same as such number assisted before the transfer, with 
such increases or decreases in unit sizes as may be contained 
in a plan approved by a local planning or development commis-
sion or department; and 
(2) no reduction in the total amount of the housing assist-
ance payments under contracts described in subsection (b)(1). 
SEC. 2804. PUBLIC HOUSING DISASTER RELIEF. 
Section 9 of the United States Housing Act of 1937 (42 U.S.C. 
1437g) is amended— 
(1) by striking subsection (k); and 
(2) by redesignating subsections (l), (m), and (n) as sub-
sections (k), (l), and (m), respectively. 
SEC. 2805. PRESERVATION OF CERTAIN AFFORDABLE HOUSING. 
Notwithstanding any other provision of law— 
(1) for the property known as Nihonmachi Terrace (FHA 
No. 121-44284), in San Francisco, California, upon the refi-
nancing of the existing federally insured mortgage pursuant 
to section 236(b) of the National Housing Act (12 U.S.C. 1715z– 
1(b)), unassisted low and moderate-income residents of the 
property shall be deemed eligible for and shall receive voucher 
assistance under section 8(o) of the United States Housing 
Act of 1937 (42 U.S.C. 1437f(o)); and 
(2) to preserve the affordability of the property, the housing 
authority shall utilize such additional voucher assistance pursu-
ant to subsection 8(o)(13) of the United States Housing Act 
of 1937, without regard to the limitations of subparagraphs 
(B) and (D) of that subsection. 
Amounts for the vouchers pursuant to this section shall be provided 
under amounts appropriated for tenant-based rental assistance 
otherwise authorized. 
California. 
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122 STAT. 2867 
PUBLIC LAW 110–289—JULY 30, 2008 
Subtitle B—Coordination of Federal Hous-
ing Programs and Tax Incentives for 
Housing 
SEC. 2831. SHORT TITLE. 
This subtitle may be cited as the ‘‘Housing Tax Credit Coordina-
tion Act of 2008’’. 
SEC. 2832. APPROVALS BY DEPARTMENT OF HOUSING AND URBAN 
DEVELOPMENT. 
(a) ADMINISTRATIVE AND PROCEDURAL CHANGES.— 
(1) IN
GENERAL.—The Secretary of Housing and Urban 
Development (in this section referred to as the ‘‘Secretary’’) 
shall, not later than the expiration of the 6-month period begin-
ning upon after the date of the enactment of this Act, implement 
administrative and procedural changes to expedite approval 
of multifamily housing projects under the jurisdiction of the 
Department of Housing and Urban Development that meet 
the requirements of the Secretary for such approvals. 
(2) PROJECTS.—The multifamily housing projects referred 
to in paragraph (1) shall include— 
(A) projects for which assistance is provided by such 
Department in conjunction with any low-income housing 
tax credits under section 42 of the Internal Revenue Code 
of 1986 or tax-exempt housing bonds; and 
(B) existing public housing projects and assisted 
housing projects, for which approval of the Secretary is 
necessary for transactions, in conjunction with any such 
low-income housing tax credits or tax-exempt housing 
bonds, involving the preservation or rehabilitation of the 
project. 
(3) CHANGES.—The administrative and procedural changes 
referred to in paragraph (1) shall include all actions necessary 
to carry out paragraph (1), which may include— 
(A) improving the efficiency of approval procedures; 
(B) simplifying approval requirements, 
(C) establishing time deadlines or target deadlines for 
required approvals; 
(D) modifying division of approval authority between 
field and national offices; 
(E) improving outreach to project sponsors regarding 
information that is required to be submitted for such 
approvals; 
(F) requesting additional funding for increasing staff, 
if necessary; and 
(G) any other actions which would expedite approvals. 
Any such changes shall be made in a manner that provides 
for full compliance with any existing requirements under law 
or regulation that are designed to protect families receiving 
public and assisted housing assistance, including income tar-
geting, rent, and fair housing provisions, and shall also comply 
with requirements regarding environmental review and protec-
tion and wages paid to laborers. 
(b) CONSULTATION.—The Secretary shall consult with the 
Commissioner of the Internal Revenue Service and take such actions 
Deadline. 
12 USC 1715s. 
12 USC 1701 
note. 
Housing Tax 
Credit 
Coordination 
Act of 2008. 
Disadvantaged 
persons. 
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122 STAT. 2868 
PUBLIC LAW 110–289—JULY 30, 2008 
as are appropriate in conjunction with such consultation to simplify 
the coordination of rules, regulations, forms, and approval require-
ments for multifamily housing projects projects for which assistance 
is provided by such Department in conjunction with any low-income 
housing tax credits under section 42 of the Internal Revenue Code 
of 1986 or tax-exempt housing bonds. 
(c) RECOMMENDATIONS.—In implementing the changes required 
under this section, the Secretary shall solicit recommendations 
regarding such changes from project owners and sponsors, investors 
and stakeholders in housing tax credits, State and local housing 
finance agencies, public housing agencies, tenant advocates, and 
other stakeholders in such projects. 
(d) REPORT.—Not later than the expiration of the 9-month 
period beginning on the date of the enactment of this Act, the 
Secretary shall submit a report to the Committee on Financial 
Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate that— 
(1) identifies the actions taken by the Secretary to comply 
with this section; 
(2) includes information regarding any resulting improve-
ments in the expedited approval for multifamily housing 
projects; 
(3) identifies recommendations made pursuant to sub-
section (c); 
(4) identifies actions taken by the Secretary to implement 
the provisions in the amendments made by sections 2834 and 
2835 of this Act; and 
(5) makes recommendations for any legislative changes 
that are needed to facilitate prompt approval of assistance 
for such projects. 
SEC. 2833. PROJECT APPROVALS BY RURAL HOUSING SERVICE. 
Section 515(h) of the Housing Act of 1949 (42 U.S.C. 1485) 
is amended— 
(1) by inserting ‘‘(1) CONDITION.—’’ after ‘‘(h)’’; and 
(2) by adding at the end the following new paragraphs: 
‘‘(2) ACTIONS TO EXPEDITE PROJECT APPROVALS.— 
‘‘(A) IN GENERAL.—The Secretary shall take actions 
to facilitate timely approval of requests to transfer owner-
ship or control, for the purpose of rehabilitation or preserva-
tion, of multifamily housing projects for which assistance 
is provided by the Secretary of Agriculture in conjunction 
with any low-income housing tax credits under section 
42 of the Internal Revenue Code of 1986 or tax-exempt 
housing bonds. 
‘‘(B) CONSULTATION.—The Secretary of Agriculture 
shall consult with the Commissioner of the Internal Rev-
enue Service and take such actions as are appropriate 
in conjunction with such consultation to simplify the 
coordination of rules, regulations, forms (including applica-
tions forms for project transfers), and approval require-
ments multifamily housing projects for which assistance 
is provided by the Secretary of Agriculture in conjunction 
with any low-income housing tax credits under section 
42 of the Internal Revenue Code of 1986 or tax-exempt 
housing bonds. 
Deadline. 
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122 STAT. 2869 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) EXISTING
REQUIREMENTS.—Any actions taken 
pursuant to this paragraph shall be taken in a manner 
that provides for full compliance with any existing require-
ments under law or regulation that are designed to protect 
families receiving Federal housing assistance, including 
income targeting, rent, and fair housing provisions, and 
shall also comply with requirements regarding environ-
mental review and protection and wages paid to laborers. 
‘‘(D) 
RECOMMENDATIONS.—In 
implementing 
the 
changes required under this paragraph, the Secretary shall 
solicit recommendations regarding such changes from 
project owners and sponsors, investors and stakeholders 
in housing tax credits, State and local housing finance 
agencies, tenant advocates, and other stakeholders in such 
projects.’’. 
SEC. 2834. USE OF FHA LOANS WITH HOUSING TAX CREDITS. 
(a) SUBSIDY LAYERING REQUIREMENTS.—Subsection (d) of sec-
tion 102 of the Department of Housing and Urban Development 
Reform Act of 1989 (42 U.S.C. 3545(d)) is amended— 
(1) in the first sentence, by inserting after ‘‘assistance 
within the jurisdiction of the Department’’ the following: ‘‘, 
as such term is defined in subsection (m), except that for 
purposes of this subsection such term shall not include any 
mortgage insurance provided pursuant to title II of the National 
Housing Act (12 U.S.C. 1707 et seq.)’’; and 
(2) in the second sentence, by inserting ‘‘such’’ before 
‘‘assistance’’. 
(b) COST CERTIFICATION.—Section 227 of National Housing Act 
(12 U.S.C. 1715r) is amended— 
(1) in the matter preceding paragraph (a) (relating to a 
definition of ‘‘new or rehabilitated multifamily housing’’)— 
(A) in the first sentence— 
(i) by striking ‘‘Notwithstanding’’ and inserting 
‘‘Except as provided in subsection (b) and notwith-
standing’’; and 
(ii) by redesignating clauses (a) and (b) as clauses 
(A) and (B), respectively; and 
(B) by striking ‘‘As used in this section—’’; 
(2) in paragraph (c) (relating to a definition of ‘‘actual 
cost’’)— 
(A) in clause (i), by redesignating clauses (1) and (2) 
as clauses (I) and (II), respectively; and 
(B) in clause (ii), by redesignating clauses (1) and 
(2) as clauses (I) and (II), respectively; 
(3) by redesignating paragraphs (a), (b), and (c) as para-
graphs (1), (2), and (3), respectively; 
(4) by inserting before paragraph (1) (as so redesignated 
by paragraph (3) of this subsection) the following: 
‘‘(b) EXEMPTION FOR CERTAIN PROJECTS ASSISTED WITH LOW- 
INCOME HOUSING TAX CREDIT.—In the case of any mortgage insured 
under any provision of this title that is executed in connection 
with the construction, rehabilitation, purchase, or refinancing of 
a multifamily housing project for which equity provided through 
any low-income housing tax credit pursuant to section 42 of the 
Internal Revenue Code of 1986 (26 U.S.C. 42), if the Secretary 
determines at the time of issuance of the firm commitment for 
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122 STAT. 2870 
PUBLIC LAW 110–289—JULY 30, 2008 
insurance that the ratio of the loan proceeds to the actual cost 
of the project is less than 80 percent, subsection (a) of this section 
shall not apply. 
‘‘(c) DEFINITIONS.—For purposes of this section, the following 
definitions shall apply:’’; and 
(5) by inserting ‘‘(a) REQUIREMENT.—’’ after ‘‘227.’’. 
(c) OTHER PROVISIONS REGARDING TREATMENT OF MORTGAGES 
COVERING TAX CREDIT PROJECTS.—Title II of the National Housing 
Act is amended by inserting after section 227 (12 U.S.C. 1715r) 
the following new section: 
‘‘SEC. 228. TREATMENT OF MORTGAGES COVERING TAX CREDIT 
PROJECTS. 
‘‘(a) DEFINITION.—For purposes of this section, the term ‘insured 
mortgage covering a tax credit project’ means a mortgage insured 
under any provision of this title that is executed in connection 
with the construction, rehabilitation, purchase, or refinancing of 
a multifamily housing project for which equity provided through 
any low-income housing tax credit pursuant to section 42 of the 
Internal Revenue Code of 1986 (26 U.S.C. 42). 
‘‘(b) ACCEPTANCE OF LETTERS OF CREDIT.—In the case of an 
insured mortgage covering a tax credit project, the Secretary may 
not require the escrowing of equity provided by the sale of any 
low-income housing tax credits for the project pursuant to section 
42 of the Internal Revenue Code of 1986, or any other form of 
security, such as a letter of credit. 
‘‘(c) ASSET MANAGEMENT REQUIREMENTS.—In the case of an 
insured mortgage covering a tax credit project for which project 
the applicable tax credit allocating agency is causing to be per-
formed periodic inspections in compliance with the requirements 
of section 42 of the Internal Revenue Code of 1986, such project 
shall be exempt from requirements imposed by the Secretary 
regarding periodic inspections of the property by the mortgagee. 
To the extent that other compliance monitoring is being performed 
with respect to such a project by such an allocating agency pursuant 
to such section 42, the Secretary shall, to the extent that the 
Secretary determines such monitoring is sufficient to ensure compli-
ance with any requirements established by the Secretary, accept 
such agency’s evidence of compliance for purposes of determining 
compliance with the Secretary’s requirements. 
‘‘(d) STREAMLINED PROCESSING PILOT PROGRAM.— 
‘‘(1) IN
GENERAL.—The Secretary shall establish a pilot 
program to demonstrate the effectiveness of streamlining the 
review process, which shall include all applications for mortgage 
insurance under any provision of this title for mortgages 
executed in connection with the construction, rehabilitation, 
purchase, or refinancing of a multifamily housing project for 
which equity provided through any low-income housing tax 
credit pursuant to section 42 of the Internal Revenue Code 
of 1986. The Secretary shall issue instructions for implementing 
the pilot program under this subsection not later than the 
expiration of the 180-day period beginning upon the date of 
the enactment of the Housing Tax Credit Coordination Act 
of 2008. 
‘‘(2) REQUIREMENTS.—Such pilot program shall provide 
for— 
Intructions. 
Deadline. 
12 USC 1715s. 
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122 STAT. 2871 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) the Secretary to appoint designated underwriters, 
who shall be responsible for reviewing such mortgage insur-
ance applications and making determinations regarding 
the eligibility of such applications for such mortgage insur-
ance in lieu of the processing functions regarding such 
applications that are otherwise performed by other 
employees of the Department of Housing and Urban 
Development; 
‘‘(B) submission of applications for such mortgage 
insurance by mortgagees who have previously been 
expressly approved by the Secretary; and 
‘‘(C) determinations regarding the eligibility of such 
applications for such mortgage insurance to be made by 
the chief underwriter pursuant to requirements prescribed 
by the Secretary, which shall include requiring submission 
of reports regarding applications of proposed mortgagees 
by third-party entities expressly approved by the chief 
underwriter.’’. 
SEC. 2835. OTHER HUD PROGRAMS. 
(a) SECTION 8 ASSISTANCE.— 
(1) PHA PROJECT-BASED ASSISTANCE.—Section 8(o)(13) of 
the United States Housing Act of 1937 (42 U.S.C. 1437f(o)(13)) 
is amended— 
(A) in subparagraph (D)(i)— 
(i) by striking ‘‘building’’ and inserting ‘‘project’’; 
and 
(ii) by adding at the end the following: ‘‘For pur-
poses of this subparagraph, the term’’project‘‘ means 
a single building, multiple contiguous buildings, or 
multiple buildings on contiguous parcels of land.’’; 
(B) in the first sentence of subparagraph (F), by 
striking ‘‘10 years’’ and inserting ‘‘15 years’’; 
(C) in subparagraph (G)— 
(i) by inserting after the period at the end of the 
first sentence the following: ‘‘Such contract may, at 
the election of the public housing agency and the owner 
of the structure, specify that such contract shall be 
extended for renewal terms of up to 15 years each, 
if the agency makes the determination required by 
this subparagraph and the owner is in compliance 
with the terms of the contract.’’; and 
(ii) by adding at the end the following: ‘‘A public 
housing agency may agree to enter into such a contract 
at the time it enters into the initial agreement for 
a housing assistance payment contract or at any time 
thereafter that is before the expiration of the housing 
assistance payment contract.’’; 
(D) in subparagraph (H), by inserting before the period 
at the end of the first sentence the following: ‘‘, except 
that in the case of a contract unit that has been allocated 
low-income housing tax credits and for which the rent 
limitation pursuant to such section 42 is less than the 
amount that would otherwise be permitted under this 
subparagraph, the rent for such unit may, in the sole 
discretion of a public housing agency, be established at 
the higher section 8 rent, subject only to paragraph (10)(A)’’; 
Definition. 
Reports. 
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122 STAT. 2872 
PUBLIC LAW 110–289—JULY 30, 2008 
(E) in subparagraph (I)(i), by inserting before the semi-
colon the following: ‘‘, except that the contract may provide 
that the maximum rent permitted for a dwelling unit shall 
not be less than the initial rent for the dwelling unit 
under the initial housing assistance payments contract cov-
ering the unit’’; and 
(F) by adding at the end the following new subpara-
graphs: 
‘‘(L) USE
IN
COOPERATIVE
HOUSING
AND
ELEVATOR 
BUILDINGS.—A public housing agency may enter into a 
housing assistance payments contract under this paragraph 
with respect to— 
‘‘(i) dwelling units in cooperative housing; and 
‘‘(ii) notwithstanding subsection (c), dwelling units 
in a high-rise elevator project, including such a project 
that is occupied by families with children, without 
review and approval of the contract by the Secretary. 
‘‘(M) REVIEWS.— 
‘‘(i) SUBSIDY LAYERING.—A subsidy layering review 
in accordance with section 102(d) of the Department 
of Housing and Urban Development Reform Act of 
1989 (42 U.S.C. 3545(d)) shall not be required for 
assistance under this paragraph in the case of a 
housing assistance payments contract for an existing 
structure, or if a subsidy layering review has been 
conducted by the applicable State or local agency. 
‘‘(ii) ENVIRONMENTAL REVIEW.—A public housing 
agency shall not be required to undertake any environ-
mental review before entering into a housing assistance 
payments contract under this paragraph for an existing 
structure, except to the extent such a review is other-
wise required by law or regulation.’’. 
(2) VOUCHER
PROGRAM
RENT
REASONABLENESS.—Section 
8(o)(10) of the United States Housing Act of 1937 (42 U.S.C. 
1437f(o)(10)) is amended by adding at the end the following 
new subparagraph; 
‘‘(F) TAX CREDIT PROJECTS.—In the case of a dwelling 
unit receiving tax credits pursuant to section 42 of the 
Internal Revenue Code of 1986 or for which assistance 
is provided under subtitle A of title II of the Cranston 
Gonzalez National Affordable Housing Act of 1990, for 
which a housing assistance contract not subject to para-
graph (13) of this subsection is established, rent reasonable-
ness shall be determined as otherwise provided by this 
paragraph, except that— 
‘‘(i) comparison with rent for units in the private, 
unassisted local market shall not be required if the 
rent is equal to or less than the rent for other com-
parable units receiving such tax credits or assistance 
in the project that are not occupied by families assisted 
with tenant-based assistance under this subsection; 
and 
‘‘(ii) the rent shall not be considered reasonable 
for purposes of this paragraph if it exceeds the greater 
of— 
‘‘(I) the rents charged for other comparable 
units receiving such tax credits or assistance in 
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122 STAT. 2873 
PUBLIC LAW 110–289—JULY 30, 2008 
the project that are not occupied by families 
assisted with tenant-based assistance under this 
subsection; and 
‘‘(II) the payment standard established by the 
public housing agency for a unit of the size 
involved.’’. 
(b) SECTION 202 HOUSING FOR ELDERLY PERSONS.—Subsection 
(f) of section 202 of the Housing Act of 1959 (12 U.S.C. 1701q(f)) 
is amended— 
(1) by striking ‘‘SELECTION CRITERIA.—’’ and inserting ‘‘INI-
TIAL SELECTION CRITERIA AND PROCESSING.— (1) SELECTION 
CRITERIA.—’’; 
(2) by redesignating paragraphs (1) through (7) as subpara-
graphs (A) through (G), respectively; and 
(3) by adding at the end the following new paragraph: 
‘‘(2) DELEGATED PROCESSING.— 
‘‘(A) In issuing a capital advance under this subsection 
for any project for which financing for the purposes 
described in the last two sentences of subsection (b) is 
provided by a combination of a capital advance under sub-
section (c)(1) and sources other than this section, within 
30 days of award of the capital advance, the Secretary 
shall delegate review and processing of such projects to 
a State or local housing agency that— 
‘‘(i) is in geographic proximity to the property; 
‘‘(ii) has demonstrated experience in and capacity 
for underwriting multifamily housing loans that pro-
vide housing and supportive services; 
‘‘(iii) may or may not be providing low-income 
housing tax credits in combination with the capital 
advance under this section, and 
‘‘(iv) agrees to issue a firm commitment within 
12 months of delegation. 
‘‘(B) The Secretary shall retain the authority to process 
capital advances in cases in which no State or local housing 
agency has applied to provide delegated processing pursu-
ant to this paragraph or no such agency has entered into 
an agreement with the Secretary to serve as a delegated 
processing agency. 
‘‘(C) An agency to which review and processing is dele-
gated pursuant to subparagraph (A) may assess a reason-
able fee which shall be included in the capital advance 
amounts and may recommend project rental assistance 
amounts in excess of those initially awarded by the Sec-
retary. The Secretary shall develop a schedule for reason-
able fees under this subparagraph to be paid to delegated 
processing agencies, which shall take into consideration 
any other fees to be paid to the agency for other funding 
provided to the project by the agency, including bonds, 
tax credits, and other gap funding. 
‘‘(D) Under such delegated system, the Secretary shall 
retain the authority to approve rents and development 
costs and to execute a capital advance within 60 days 
of receipt of the commitment from the State or local agency. 
The Secretary shall provide to such agency and the project 
sponsor, in writing, the reasons for any reduction in capital 
Deadline. 
Deadlines. 
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122 STAT. 2874 
PUBLIC LAW 110–289—JULY 30, 2008 
advance amounts or project rental assistance and such 
reductions shall be subject to appeal.’’. 
(c) MCKINNEY-VENTO
ACT
HOMELESS
ASSISTANCE
UNDER 
SHELTER PLUS CARE PROGRAM.— 
(1) TERM OF CONTRACTS WITH OWNER OR LESSOR.—Part 
I of subtitle F of the McKinney-Vento Homeless Assistance 
Act is amended— 
(A) by redesignating sections 462 and 463 (42 U.S.C. 
11403g, 11403h) as sections 463 and 464, respectively; 
(B) by striking ‘‘section 463’’ each place such term 
appears in sections 471, 476, 481, 486, and 488 (42 U.S.C. 
11404, 11405, 11406, 11407, and 11407b) and inserting 
‘‘section 464’’; and 
(C) by inserting after section 461 (42 U.S.C. 11403f) 
the following new section: 
‘‘SEC. 462. TERM OF CONTRACT WITH OWNER OR LESSOR. 
‘‘An applicant under this subtitle may enter into a contract 
with the owner or lessor of a property that receives rental assistance 
under this subtitle having a term of not more than 15 years, 
subject to the availability of sufficient funds provided in appropria-
tion Acts for the purpose of renewing expiring contracts for assist-
ance payments. Such contract may, at the election of the applicant 
and owner or lessor, specify that such contract shall be extended 
for renewal terms of not more than 15 years each, subject to 
the availability of sufficient such appropriated funds.’’. 
(2) PROJECT-BASED RENTAL ASSISTANCE CONTRACTS.—Sec-
tion 478(a) of the McKinney-Vento Homeless Assistance Act 
(42 U.S.C. 11405a(a)) is amended by inserting before the period 
at the end the following: ‘‘; except that, in the case of any 
project for which equity is provided through any low-income 
housing tax credit pursuant to section 42 of the Internal Rev-
enue Code of 1986 (26 U.S.C. 42), if an expenditure of such 
amount for each unit (including the prorated share of such 
work) is required to make the structure decent, safe, and sani-
tary, and the owner agrees to reach initial closing on permanent 
financing from such other sources within two years and agrees 
to carry out the rehabilitation with resources other than assist-
ance under this subtitle within 60 months of notification of 
grant approval, the contract shall be for a term of 10 years 
(except that such period may be extended by up to 1 year 
by the Secretary, which extension shall be granted unless the 
Secretary determines that the sponsor is primarily responsible 
for the failure to meet such deadline)’’. 
(d) DATA COLLECTION ON TENANTS OF HOUSING TAX CREDIT 
PROJECTS.—Title I of the United States Housing Act of 1937 (42 
U.S.C. 1437 et seq.) is amended by adding at the end the following 
new section: 
‘‘SEC. 36. COLLECTION OF INFORMATION ON TENANTS IN TAX CREDIT 
PROJECTS. 
‘‘(a) IN GENERAL.—Each State agency administering tax credits 
under section 42 of the Internal Revenue Code of 1986 (26 U.S.C. 
42) shall furnish to the Secretary of Housing and Urban Develop-
ment, not less than annually, information concerning the race, 
ethnicity, family composition, age, income, use of rental assistance 
under section 8(o) of the United States Housing Act of 1937 or 
Deadline. 
42 USC 
1437z–8. 
Termination 
date. 
Extension. 
42 USC 11405b. 
42 USC 
11403f–1. 
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122 STAT. 2875 
PUBLIC LAW 110–289—JULY 30, 2008 
other similar assistance, disability status, and monthly rental pay-
ments of households residing in each property receiving such credits 
through such agency. Such State agencies shall, to the extent fea-
sible, collect such information through existing reporting processes 
and in a manner that minimizes burdens on property owners. 
In the case of any household that continues to reside in the same 
dwelling unit, information provided by the household in a previous 
year may be used if the information is of a category that is not 
subject to change or if information for the current year is not 
readily available to the owner of the property. 
‘‘(b) STANDARDS.—The Secretary shall establish standards and 
definitions for the information collected under subsection (a), pro-
vide States with technical assistance in establishing systems to 
compile and submit such information, and, in coordination with 
other Federal agencies administering housing programs, establish 
procedures to minimize duplicative reporting requirements for prop-
erties assisted under multiple housing programs. 
‘‘(c) PUBLIC AVAILABILITY.—The Secretary shall, not less than 
annually, compile and make publicly available the information sub-
mitted to the Secretary pursuant to subsection (a). 
‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized 
to be appropriated for the cost of activities required under sub-
sections (b) and (c) $2,500,000 for fiscal year 2009 and $900,000 
for each of fiscal years 2010 through 2013.’’. 
TITLE IX—MISCELLANEOUS 
SEC. 2901. HOMELESS ASSISTANCE. 
(a) APPROPRIATIONS.—Section 726 of the McKinney-Vento 
Homeless Assistance Act (42 U.S.C. 11435) is amended by striking 
‘‘$70,000,000’’ and all that follows and inserting ‘‘$100,000,000 for 
fiscal year 2009 and such sums as may be necessary for each 
subsequent fiscal year.’’. 
(b) EMERGENCY ASSISTANCE.—Section 722 of the McKinney- 
Vento Homeless Assistance Act (42 U.S.C. 11432) is amended by 
adding at the end the following: 
‘‘(h) SPECIAL RULE FOR EMERGENCY ASSISTANCE.— 
‘‘(1) EMERGENCY ASSISTANCE.— 
‘‘(A) RESERVATION OF AMOUNTS.—Subject to paragraph 
(4) and notwithstanding any other provision of this title, 
the Secretary shall use funds appropriated under section 
726 for fiscal year 2009, but not to exceed $30,000,000, 
for the purposes of providing emergency assistance through 
grants. 
‘‘(B) GENERAL AUTHORITY.—The Secretary shall use the 
funds to make grants to State educational agencies under 
paragraph (2), to enable the agencies to make subgrants 
to local educational agencies under paragraph (3), to pro-
vide activities described in section 723(d) for individuals 
referred to in subparagraph (C). 
‘‘(C) ELIGIBLE
INDIVIDUALS.—Funds made available 
under this subsection shall be used to provide such activi-
ties for eligible individuals, consisting of homeless children 
and youths, and their families, who have become homeless 
due to home foreclosure, including children and youths, 
State and local 
governments. 
Grants. 
Deadline. 
Reports. 
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122 STAT. 2876 
PUBLIC LAW 110–289—JULY 30, 2008 
and their families, who became homeless when lenders 
foreclosed on properties rented by the families. 
‘‘(2) GRANTS TO STATE EDUCATIONAL AGENCIES.— 
‘‘(A) DISBURSEMENT.—The Secretary shall make grants 
with funds provided under paragraph (1)(A) to State edu-
cational agencies based on need, consistent with the 
number of eligible individuals described in paragraph (1)(C) 
in the States involved, as determined by the Secretary. 
‘‘(B) ASSURANCE.—To be eligible to receive a grant 
under this paragraph, a State educational agency shall 
provide an assurance to the Secretary that the State edu-
cational agency, and each local educational agency 
receiving a subgrant from the State educational agency 
under this subsection shall ensure that the activities car-
ried out under this subsection are consistent with the 
activities described in section 723(d). 
‘‘(3) SUBGRANTS TO LOCAL EDUCATIONAL AGENCIES.—A State 
educational agency that receives a grant under paragraph (2) 
shall use the funds made available through the grant to make 
subgrants to local educational agencies. The State educational 
agency shall make the subgrants to local educational agencies 
based on need, consistent with the number of eligible individ-
uals described in paragraph (1)(C) in the areas served by the 
local educational agencies, as determined by the State edu-
cational agency. 
‘‘(4) RESTRICTION.—The Secretary— 
‘‘(A) shall determine the amount (if any) by which 
the funds appropriated under section 726 for fiscal year 
2009 exceed $70,000,000; and 
‘‘(B) may only use funds from that amount to carry 
out this subsection.’’. 
SEC. 2902. INCREASING ACCESS AND UNDERSTANDING OF ENERGY 
EFFICIENT MORTGAGES. 
(a) DEFINITION.—As used in this section, the term ‘‘energy 
efficient mortgage’’ has the same meaning as given that term in 
paragraph (24) of section 104 of the Cranston-Gonzalez National 
Affordable Housing Act (42 U.S.C. 12704(24)). 
(b) RECOMMENDATIONS
TO ELIMINATE BARRIERS
TO USE
OF 
ENERGY EFFICIENT MORTGAGES.— 
(1) IN GENERAL.—Not later than 180 days after the date 
of enactment of this section, the Secretary of Housing and 
Urban Development, in conjunction with the Secretary of 
Energy and the Administrator of the Environmental Protection 
Agency, shall consult with the residential mortgage industry 
and States to develop recommendations to eliminate the bar-
riers that exist to increasing the availability, use, and purchase 
of energy efficient mortgages, including such barriers as— 
(A) the lack of reliable and accessible information on 
such mortgages, including estimated energy savings and 
other benefits of energy efficient housing; 
(B) the confusion regarding underwriting requirements 
and differences among various energy efficient mortgage 
programs; 
(C) the complex and time consuming process of securing 
such mortgages; 
Deadline. 
12 USC 
1701z–17. 
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122 STAT. 2877 
PUBLIC LAW 110–289—JULY 30, 2008 
(D) the lack of publicly available research on the 
default risk of such mortgages; and 
(E) the availability of certified or accredited home 
energy rating services. 
(2) REPORT TO CONGRESS.—The Secretary of Housing and 
Urban Development shall submit a report to Congress that— 
(A) summarizes the recommendations developed under 
paragraph (1); and 
(B) includes any recommendations for statutory, regu-
latory, or administrative changes that the Secretary deems 
necessary to institute such recommendations. 
(c) ENERGY EFFICIENT MORTGAGES OUTREACH CAMPAIGN.— 
(1) IN
GENERAL.—The Secretary of Housing and Urban 
Development, in consultation and coordination with the Sec-
retary of Energy, the Administrator of the Environmental 
Protection Agency, and State Energy and Housing Finance 
Directors, shall carry out an education and outreach campaign 
to inform and educate consumers, home builders, residential 
lenders, and other real estate professionals on the availability, 
benefits, and advantages of— 
(A) improved energy efficiency in housing; and 
(B) energy efficient mortgages. 
(2) AUTHORIZATION OF APPROPRIATIONS.—There are author-
ized to be appropriated such sums as are necessary to carry 
out the education and outreach campaign described under para-
graph (1). 
DIVISION C—TAX-RELATED PROVISIONS 
SEC. 3000. SHORT TITLE; ETC. 
(a) SHORT TITLE.—This division may be cited as the ‘‘Housing 
Assistance Tax Act of 2008’’. 
(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly 
provided, whenever in this division an amendment or repeal is 
expressed in terms of an amendment to, or repeal of, a section 
or other provision, the reference shall be considered to be made 
to a section or other provision of the Internal Revenue Code of 
1986. 
(c) TABLE OF CONTENTS.—The table of contents for this division 
is as follows: 
Sec. 3000. Short title; etc. 
TITLE I—HOUSING TAX INCENTIVES 
Subtitle A—Multi-Family Housing 
PART I—LOW-INCOME HOUSING TAX CREDIT 
Sec. 3001. Temporary increase in volume cap for low-income housing tax credit. 
Sec. 3002. Determination of credit rate. 
Sec. 3003. Modifications to definition of eligible basis. 
Sec. 3004. Other simplification and reform of low-income housing tax incentives. 
Sec. 3005. Treatment of military basic pay. 
PART II—MODIFICATIONS TO TAX-EXEMPT HOUSING BOND RULES 
Sec. 3007. Recycling of tax-exempt debt for financing residential rental projects. 
Sec. 3008. Coordination of certain rules applicable to low-income housing credit and 
qualified residential rental project exempt facility bonds. 
PART III—REFORMS RELATED TO THE LOW-INCOME HOUSING CREDIT AND TAX- 
EXEMPT HOUSING BONDS 
Sec. 3009. Hold harmless for reductions in area median gross income. 
26 USC 1 
note. 
Housing 
Assistance 
Tax Act of 2008. 
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122 STAT. 2878 
PUBLIC LAW 110–289—JULY 30, 2008 
Sec. 3010. Exception to annual current income determination requirement where 
determination not relevant. 
Subtitle B—Single Family Housing 
Sec. 3011. First-time homebuyer credit. 
Sec. 3012. Additional standard deduction for real property taxes for nonitemizers. 
Subtitle C—General Provisions 
Sec. 3021. Temporary liberalization of tax-exempt housing bond rules. 
Sec. 3022. Repeal of alternative minimum tax limitations on tax-exempt housing 
bonds, low-income housing tax credit, and rehabilitation credit. 
Sec. 3023. Bonds guaranteed by Federal home loan banks eligible for treatment as 
tax-exempt bonds. 
Sec. 3024. Modification of rules pertaining to FIRPTA nonforeign affidavits. 
Sec. 3025. Modification of definition of tax-exempt use property for purposes of the 
rehabilitation credit. 
Sec. 3026. Extension of special rule for mortgage revenue bonds for residences lo-
cated in disaster areas. 
Sec. 3027. Transfer of funds appropriated to carry out 2008 recovery rebates for in-
dividuals. 
TITLE II—REFORMS RELATED TO REAL ESTATE INVESTMENT TRUSTS 
Subtitle A—Foreign Currency and Other Qualified Activities 
Sec. 3031. Revisions to REIT income tests. 
Sec. 3032. Revisions to REIT asset tests. 
Sec. 3033. Conforming foreign currency revisions. 
Subtitle B—Taxable REIT Subsidiaries 
Sec. 3041. Conforming taxable REIT subsidiary asset test. 
Subtitle C—Dealer Sales 
Sec. 3051. Holding period under safe harbor. 
Sec. 3052. Determining value of sales under safe harbor. 
Subtitle D—Health Care REITs 
Sec. 3061. Conformity for health care facilities. 
Subtitle E—Effective Dates 
Sec. 3071. Effective dates. 
TITLE III—REVENUE PROVISIONS 
Subtitle A—General Provisions 
Sec. 3081. Election to accelerate the AMT and research credits in lieu of bonus de-
preciation. 
Sec. 3082. Certain GO Zone incentives. 
Sec. 3083. Increase in statutory limit on the public debt. 
Subtitle B—Revenue Offsets 
Sec. 3091. Returns relating to payments made in settlement of payment card and 
third party network transactions. 
Sec. 3092. Gain from sale of principal residence allocated to nonqualified use not 
excluded from income. 
Sec. 3093. Delay in application of worldwide allocation of interest. 
Sec. 3094. Time for payment of corporate estimated taxes. 
TITLE I—HOUSING TAX INCENTIVES 
Subtitle A—Multi-Family Housing 
PART I—LOW-INCOME HOUSING TAX CREDIT 
SEC. 3001. TEMPORARY INCREASE IN VOLUME CAP FOR LOW-INCOME 
HOUSING TAX CREDIT. 
Paragraph (3) of section 42(h) is amended by adding at the 
end the following new subparagraph: 
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122 STAT. 2879 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(I) INCREASE IN STATE HOUSING CREDIT CEILING FOR 
2008 AND 2009.—In the case of calendar years 2008 and 
2009— 
‘‘(i) the dollar amount in effect under subparagraph 
(C)(ii)(I) for such calendar year (after any increase 
under subparagraph (H)) shall be increased by $0.20, 
and 
‘‘(ii) the dollar amount in effect under subpara-
graph (C)(ii)(II) for such calendar year (after any 
increase under subparagraph (H)) shall be increased 
by an amount equal to 10 percent of such dollar amount 
(rounded to the next lowest multiple of $5,000).’’. 
SEC. 3002. DETERMINATION OF CREDIT RATE. 
(a) TEMPORARY MINIMUM CREDIT RATE FOR NON-FEDERALLY 
SUBSIDIZED NEW BUILDINGS.— 
(1) IN GENERAL.—Subsection (b) of section 42 is amended 
by striking paragraph (1), by redesignating paragraph (2) as 
paragraph (1), and by inserting after paragraph (1), as so 
redesignated, the following new paragraph: 
‘‘(2) TEMPORARY MINIMUM CREDIT RATE FOR NON-FEDERALLY 
SUBSIDIZED NEW BUILDINGS.—In the case of any new building— 
‘‘(A) which is placed in service by the taxpayer after 
the date of the enactment of this paragraph and before 
December 31, 2013, and 
‘‘(B) which is not federally subsidized for the taxable 
year, 
the applicable percentage shall not be less than 9 percent.’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subsection (b) of section 42, as amended by para-
graph (1), is amended by striking ‘‘For purposes of this 
section—’’ and all that follows through ‘‘means the appro-
priate’’ and inserting the following: 
‘‘(1) DETERMINATION OF APPLICABLE PERCENTAGE.—For pur-
poses of this section, the term ‘applicable percentage’ means, 
with respect to any building, the appropriate’’. 
(B) Clause (i) of section 42(b)(1)(B), as redesignated 
by paragraph (1), is amended by striking ‘‘a building 
described in paragraph (1)(A)’’ and inserting ‘‘a new 
building which is not federally subsidized for the taxable 
year’’. 
(C) Clause (ii) of section 42(b)(1)(B), as redesignated 
by paragraph (1), is amended by striking ‘‘a building 
described in paragraph (1)(B)’’ and inserting ‘‘a building 
not described in clause (i)’’. 
(b) MODIFICATIONS TO DEFINITION OF FEDERALLY SUBSIDIZED 
BUILDING.— 
(1) IN GENERAL.—Subparagraph (A) of section 42(i)(2) is 
amended by striking ‘‘, or any below market Federal loan,’’. 
(2) CONFORMING AMENDMENTS.— 
(A) Subparagraph (B) of section 42(i)(2) is amended— 
(i) by striking ‘‘BALANCE
OF
LOAN
OR’’ in the 
heading thereof, 
(ii) by striking ‘‘loan or’’ in the matter preceding 
clause (i), and 
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122 STAT. 2880 
PUBLIC LAW 110–289—JULY 30, 2008 
(iii) by striking ‘‘subsection (d)—’’ and all that fol-
lows and inserting ‘‘subsection (d) the proceeds of such 
obligation.’’. 
(B) Subparagraph (C) of section 42(i)(2) is amended— 
(i) by striking ‘‘or below market Federal loan’’ in 
the matter preceding clause (i), 
(ii) in clause (i)— 
(I) by striking ‘‘or loan (when issued or made)’’ 
and inserting ‘‘(when issued)’’, and 
(II) by striking ‘‘the proceeds of such obligation 
or loan’’ and inserting ‘‘the proceeds of such obliga-
tion’’, and 
(iii) by striking ‘‘, and such loan is repaid,’’ in 
clause (ii). 
(C) Paragraph (2) of section 42(i) is amended by 
striking subparagraphs (D) and (E). 
(c) EFFECTIVE DATE.—The amendments made by this subsection 
shall apply to buildings placed in service after the date of the 
enactment of this Act. 
SEC. 3003. MODIFICATIONS TO DEFINITION OF ELIGIBLE BASIS. 
(a) INCREASE
IN CREDIT
FOR CERTAIN STATE DESIGNATED 
BUILDINGS.—Subparagraph (C) of section 42(d)(5) (relating to 
increase in credit for buildings in high cost areas), before redesigna-
tion under subsection (g), is amended by adding at the end the 
following new clause: 
‘‘(v) BUILDINGS
DESIGNATED
BY
STATE
HOUSING 
CREDIT AGENCY.—Any building which is designated by 
the State housing credit agency as requiring the 
increase in credit under this subparagraph in order 
for such building to be financially feasible as part 
of a qualified low-income housing project shall be 
treated for purposes of this subparagraph as located 
in a difficult development area which is designated 
for purposes of this subparagraph. The preceding sen-
tence shall not apply to any building if paragraph 
(1) of subsection (h) does not apply to any portion 
of the eligible basis of such building by reason of para-
graph (4) of such subsection.’’. 
(b) MODIFICATION TO REHABILITATION REQUIREMENTS.— 
(1) IN
GENERAL.—Clause (ii) of section 42(e)(3)(A) is 
amended— 
(A) by striking ‘‘10 percent’’ in subclause (I) and 
inserting ‘‘20 percent’’, and 
(B) by striking ‘‘$3,000’’ in subclause (II) and inserting 
‘‘$6,000’’. 
(2) INFLATION ADJUSTMENT.—Paragraph (3) of section 42(e) 
is amended by adding at the end the following new subpara-
graph: 
‘‘(D) INFLATION
ADJUSTMENT.—In the case of any 
expenditures which are treated under paragraph (4) as 
placed in service during any calendar year after 2009, 
the $6,000 amount in subparagraph (A)(ii)(II) shall be 
increased by an amount equal to— 
‘‘(i) such dollar amount, multiplied by 
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122 STAT. 2881 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) the cost-of-living adjustment determined 
under section 1(f)(3) for such calendar year by sub-
stituting ‘calendar year 2008’ for ‘calendar year 1992’ 
in subparagraph (B) thereof. 
Any increase under the preceding sentence which is not 
a multiple of $100 shall be rounded to the nearest multiple 
of $100.’’. 
(3) CONFORMING
AMENDMENT.—Subclause (II) of section 
42(f)(5)(B)(ii) 
is 
amended 
by 
striking 
‘‘if 
subsection 
(e)(3)(A)(ii)(II)’’ and all that follows and inserting ‘‘if the dollar 
amount in effect under subsection (e)(3)(A)(ii)(II) were two- 
thirds of such amount.’’. 
(c) INCREASE
IN ALLOWABLE COMMUNITY SERVICE FACILITY 
SPACE
FOR SMALL PROJECTS.—Clause (ii) of section 42(d)(4)(C) 
(relating to limitation) is amended by striking ‘‘10 percent of the 
eligible basis of the qualified low-income housing project of which 
it is a part. For purposes of’’ and inserting ‘‘the sum of— 
‘‘(I) 25 percent of so much of the eligible basis 
of the qualified low-income housing project of 
which it is a part as does not exceed $15,000,000, 
plus 
‘‘(II) 10 percent of so much of the eligible basis 
of such project as is not taken into account under 
subclause (I). 
For purposes of’’. 
(d) CLARIFICATION
OF
TREATMENT
OF
FEDERAL
GRANTS.— 
Subparagraph (A) of section 42(d)(5) is amended to read as follows: 
‘‘(A) FEDERAL GRANTS NOT TAKEN INTO ACCOUNT IN 
DETERMINING
ELIGIBLE
BASIS.—The eligible basis of a 
building shall not include any costs financed with the pro-
ceeds of a federally funded grant.’’. 
(e) SIMPLIFICATION OF RELATED PARTY RULES.—Clause (iii) of 
section 42(d)(2)(D), before redesignation under subsection (g)(2), 
is amended— 
(1) by striking all that precedes subclause (II), 
(2) by redesignating subclause (II) as clause (iii) and moving 
such clause two ems to the left, and 
(3) by striking the last sentence thereof. 
(f) EXCEPTION
TO
10-YEAR
NONACQUISITION
PERIOD
FOR 
EXISTING BUILDINGS APPLICABLE TO FEDERALLY- OR STATE-ASSISTED 
BUILDINGS.—Paragraph (6) of section 42(d) is amended to read 
as follows: 
‘‘(6) CREDIT ALLOWABLE FOR CERTAIN BUILDINGS ACQUIRED 
DURING 10-YEAR PERIOD DESCRIBED IN PARAGRAPH (2)(B)(ii).— 
‘‘(A) IN GENERAL.—Paragraph (2)(B)(ii) shall not apply 
to any federally- or State-assisted building. 
‘‘(B) BUILDINGS ACQUIRED FROM INSURED DEPOSITORY 
INSTITUTIONS IN DEFAULT.—On application by the taxpayer, 
the Secretary may waive paragraph (2)(B)(ii) with respect 
to any building acquired from an insured depository institu-
tion in default (as defined in section 3 of the Federal 
Deposit Insurance Act) or from a receiver or conservator 
of such an institution. 
‘‘(C) FEDERALLY- OR
STATE-ASSISTED
BUILDING.—For 
purposes of this paragraph— 
‘‘(i) FEDERALLY-ASSISTED BUILDING.—The term ‘fed-
erally-assisted building’ means any building which is 
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122 STAT. 2882 
PUBLIC LAW 110–289—JULY 30, 2008 
substantially assisted, financed, or operated under sec-
tion 8 of the United States Housing Act of 1937, section 
221(d)(3), 221(d)(4), or 236 of the National Housing 
Act, section 515 of the Housing Act of 1949, or any 
other housing program administered by the Depart-
ment of Housing and Urban Development or by the 
Rural Housing Service of the Department of Agri-
culture. 
‘‘(ii) STATE-ASSISTED BUILDING.—The term ‘State- 
assisted building’ means any building which is substan-
tially assisted, financed, or operated under any State 
law similar in purposes to any of the laws referred 
to in clause (i).’’. 
(g) REPEAL OF DEADWOOD.— 
(1) Clause (ii) of section 42(d)(2)(B) is amended by striking 
‘‘the later of—’’ and all that follows and inserting ‘‘the date 
the building was last placed in service,’’. 
(2) Subparagraph (D) of section 42(d)(2) is amended by 
striking clause (i) and by redesignating clauses (ii) and (iii) 
as clauses (i) and (ii), respectively. 
(3) Paragraph (5) of section 42(d) is amended by striking 
subparagraph (B) and by redesignating subparagraph (C) as 
subparagraph (B). 
(h) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in para-
graph (2), the amendments made by this subsection shall apply 
to buildings placed in service after the date of the enactment 
of this Act. 
(2) REHABILITATION REQUIREMENTS.— 
(A) IN GENERAL.—The amendments made by subsection 
(b) shall apply to buildings with respect to which housing 
credit dollar amounts are allocated after the date of the 
enactment of this Act. 
(B) BUILDINGS NOT SUBJECT TO ALLOCATION LIMITS.— 
To the extent paragraph (1) of section 42(h) of the Internal 
Revenue Code of 1986 does not apply to any building by 
reason of paragraph (4) thereof, the amendments made 
by subsection (b) shall apply buildings financed with bonds 
issued pursuant to allocations made after the date of the 
enactment of this Act. 
SEC. 3004. OTHER SIMPLIFICATION AND REFORM OF LOW-INCOME 
HOUSING TAX INCENTIVES. 
(a) REPEAL PROHIBITION ON MODERATE REHABILITATION ASSIST-
ANCE.—Paragraph (2) of section 42(c) (defining qualified low-income 
building) is amended by striking the flush sentence at the end. 
(b) MODIFICATION OF TIME LIMIT FOR INCURRING 10 PERCENT 
OF PROJECT’S COST.—Clause (ii) of section 42(h)(1)(E) is amended 
by striking ‘‘(as of the later of the date which is 6 months after 
the date that the allocation was made or the close of the calendar 
year in which the allocation is made)’’ and inserting ‘‘(as of the 
date which is 1 year after the date that the allocation was made)’’. 
(c) REPEAL
OF BONDING REQUIREMENT
ON DISPOSITION
OF 
BUILDING.—Paragraph (6) of section 42(j) (relating to no recapture 
on disposition of building (or interest therein) where bond posted) 
is amended to read as follows: 
26 USC 42 
note. 
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122 STAT. 2883 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(6) NO RECAPTURE ON DISPOSITION OF BUILDING WHICH 
CONTINUES IN QUALIFIED USE.— 
‘‘(A) IN GENERAL.—The increase in tax under this sub-
section shall not apply solely by reason of the disposition 
of a building (or an interest therein) if it is reasonably 
expected that such building will continue to be operated 
as a qualified low-income building for the remaining compli-
ance period with respect to such building. 
‘‘(B) STATUTE OF LIMITATIONS.—If a building (or an 
interest therein) is disposed of during any taxable year 
and there is any reduction in the qualified basis of such 
building which results in an increase in tax under this 
subsection for such taxable or any subsequent taxable year, 
then— 
‘‘(i) the statutory period for the assessment of any 
deficiency with respect to such increase in tax shall 
not expire before the expiration of 3 years from the 
date the Secretary is notified by the taxpayer (in such 
manner as the Secretary may prescribe) of such reduc-
tion in qualified basis, and 
‘‘(ii) such deficiency may be assessed before the 
expiration of such 3-year period notwithstanding the 
provisions of any other law or rule of law which would 
otherwise prevent such assessment.’’. 
(d) ENERGY EFFICIENCY AND HISTORIC NATURE TAKEN INTO 
ACCOUNT IN MAKING ALLOCATIONS.—Subparagraph (C) of section 
42(m)(1) (relating to plans for allocation of credit among projects) 
is amended by striking ‘‘and’’ at the end of clause (vii), by striking 
the period at the end of clause (viii) and inserting a comma, and 
by adding at the end the following new clauses: 
‘‘(ix) the energy efficiency of the project, and 
‘‘(x) the historic nature of the project.’’. 
(e) CONTINUED ELIGIBILITY
FOR STUDENTS WHO RECEIVED 
FOSTER CARE ASSISTANCE.—Clause (i) of section 42(i)(3)(D) is 
amended by striking ‘‘or’’ at the end of subclause (I), by redesig-
nating subclause (II) as subclause (III), and by inserting after 
subclause (I) the following new subclause: 
‘‘(II) a student who was previously under the 
care and placement responsibility of the State 
agency responsible for administering a plan under 
part B or part E of title IV of the Social Security 
Act, or’’. 
(f) TREATMENT
OF RURAL PROJECTS.—Section 42(i) (relating 
to definitions and special rules) is amended by adding at the end 
the following new paragraph: 
‘‘(8) TREATMENT OF RURAL PROJECTS.—For purposes of this 
section, in the case of any project for residential rental property 
located in a rural area (as defined in section 520 of the Housing 
Act of 1949), any income limitation measured by reference 
to area median gross income shall be measured by reference 
to the greater of area median gross income or national non- 
metropolitan median income. The preceding sentence shall not 
apply with respect to any building if paragraph (1) of section 
42(h) does not apply by reason of paragraph (4) thereof to 
any portion of the credit determined under this section with 
respect to such building.’’. 
Notification. 
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122 STAT. 2884 
PUBLIC LAW 110–289—JULY 30, 2008 
(g) CLARIFICATION OF GENERAL PUBLIC USE REQUIREMENT.— 
Subsection (g) of section 42 is amended by adding at the end 
the following new paragraph: 
‘‘(9) CLARIFICATION
OF
GENERAL
PUBLIC
USE
REQUIRE-
MENT.—A project does not fail to meet the general public use 
requirement solely because of occupancy restrictions or pref-
erences that favor tenants— 
‘‘(A) with special needs, 
‘‘(B) who are members of a specified group under a 
Federal program or State program or policy that supports 
housing for such a specified group, or 
‘‘(C) who are involved in artistic or literary activities.’’. 
(h) GAO STUDY REGARDING MODIFICATIONS TO LOW-INCOME 
HOUSING TAX CREDIT.—Not later than December 31, 2012, the 
Comptroller General of the United States shall submit to Congress 
a report which analyzes the implementation of the modifications 
made by this subtitle to the low-income housing tax credit under 
section 42 of the Internal Revenue Code of 1986. Such report 
shall include an analysis of the distribution of credit allocations 
before and after the effective date of such modifications. 
(i) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
buildings placed in service after the date of the enactment 
of this Act. 
(2) REPEAL OF BONDING REQUIREMENT ON DISPOSITION OF 
BUILDING.—The amendment made by subsection (c) shall apply 
to— 
(A) interests in buildings disposed after the date of 
the enactment of this Act, and 
(B) interests in buildings disposed of on or before such 
date if— 
(i) it is reasonably expected that such building 
will continue to be operated as a qualified low-income 
building (within the meaning of section 42 of the 
Internal Revenue Code of 1986) for the remaining 
compliance period (within the meaning of such section) 
with respect to such building, and 
(ii) the taxpayer elects the application of this 
subparagraph with respect to such disposition. 
(3) ENERGY EFFICIENCY AND HISTORIC NATURE TAKEN INTO 
ACCOUNT IN MAKING ALLOCATIONS.—The amendments made by 
subsection (d) shall apply to allocations made after December 
31, 2008. 
(4) CONTINUED ELIGIBILITY FOR STUDENTS WHO RECEIVED 
FOSTER
CARE
ASSISTANCE.—The amendments made by sub-
section (e) shall apply to determinations made after the date 
of the enactment of this Act. 
(5) TREATMENT
OF
RURAL
PROJECTS.—The amendment 
made by subsection (f) shall apply to determinations made 
after the date of the enactment of this Act. 
(6) CLARIFICATION OF GENERAL PUBLIC USE REQUIREMENT.— 
The amendment made by subsection (g) shall apply to buildings 
placed in service before, on, or after the date of the enactment 
of this Act. 
Applicability. 
26 USC 42 
note. 
Deadline. 
Reports. 
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122 STAT. 2885 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 3005. TREATMENT OF MILITARY BASIC PAY. 
(a) IN
GENERAL.—Subparagraph (B) of section 142(d)(2) 
(relating to income of individuals; area median gross income) is 
amended— 
(1) by striking ‘‘The income’’ and inserting the following: 
‘‘(i) IN GENERAL.—The income’’, and 
(2) by adding at the end the following: 
‘‘(ii) SPECIAL
RULE
RELATING
TO
BASIC
HOUSING 
ALLOWANCES.—For purposes of determining income 
under this subparagraph, payments under section 403 
of title 37, United States Code, as a basic pay allowance 
for housing shall be disregarded with respect to any 
qualified building. 
‘‘(iii) QUALIFIED BUILDING.—For purposes of clause 
(ii), the term ‘qualified building’ means any building 
located— 
‘‘(I) in any county in which is located a quali-
fied military installation to which the number of 
members of the Armed Forces of the United States 
assigned to units based out of such qualified mili-
tary installation, as of June 1, 2008, has increased 
by not less than 20 percent, as compared to such 
number on December 31, 2005, or 
‘‘(II) in any county adjacent to a county 
described in subclause (I). 
‘‘(iv) QUALIFIED MILITARY INSTALLATION.—For pur-
poses of clause (iii), the term ‘qualified military 
installation’ means any military installation or facility 
the number of members of the Armed Forces of the 
United States assigned to which, as of June 1, 2008, 
is not less than 1,000.’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to— 
(1) determinations made after the date of the enactment 
of this Act and before January 1, 2012, in the case of any 
qualified building (as defined in section 142(d)(2)(B)(iii) of the 
Internal Revenue Code of 1986)— 
(A) with respect to which housing credit dollar amounts 
have been allocated on or before the date of the enactment 
of this Act, or 
(B) with respect to buildings placed in service before 
such date of enactment, to the extent paragraph (1) of 
section 42(h) of such Code does not apply to such building 
by reason of paragraph (4) thereof, but only with respect 
to bonds issued before such date of enactment, and 
(2) determinations made after the date of enactment of 
this Act, in the case of qualified buildings (as so defined)— 
(A) with respect to which housing credit dollar amounts 
are allocated after the date of the enactment of this Act 
and before January 1, 2012, or 
(B) with respect to which buildings placed in service 
after the date of enactment of this Act and before January 
1, 2012, to the extent paragraph (1) of section 42(h) of 
such Code does not apply to such building by reason of 
paragraph (4) thereof, but only with respect to bonds issued 
after such date of enactment and before January 1, 2012. 
26 USC 142 
note. 
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122 STAT. 2886 
PUBLIC LAW 110–289—JULY 30, 2008 
PART II—MODIFICATIONS TO TAX-EXEMPT 
HOUSING BOND RULES 
SEC. 3007. RECYCLING OF TAX-EXEMPT DEBT FOR FINANCING RESI-
DENTIAL RENTAL PROJECTS. 
(a) IN GENERAL.—Subsection (i) of section 146 (relating to treat-
ment of refunding issues) is amended by adding at the end the 
following new paragraph: 
‘‘(6) TREATMENT OF CERTAIN RESIDENTIAL RENTAL PROJECT 
BONDS AS REFUNDING BONDS IRRESPECTIVE OF OBLIGOR.— 
‘‘(A) IN GENERAL.—If, during the 6-month period begin-
ning on the date of a repayment of a loan financed by 
an issue 95 percent or more of the net proceeds of which 
are used to provide projects described in section 142(d), 
such repayment is used to provide a new loan for any 
project so described, any bond which is issued to refinance 
such issue shall be treated as a refunding issue to the 
extent the principal amount of such refunding issue does 
not exceed the principal amount of the bonds refunded. 
‘‘(B) LIMITATIONS.—Subparagraph (A) shall apply to 
only one refunding of the original issue and only if— 
‘‘(i) the refunding issue is issued not later than 
4 years after the date on which the original issue 
was issued, 
‘‘(ii) the latest maturity date of any bond of the 
refunding issue is not later than 34 years after the 
date on which the refunded bond was issued, and 
‘‘(iii) the refunding issue is approved in accordance 
with section 147(f) before the issuance of the refunding 
issue.’’. 
(b) LOW-INCOME
HOUSING
CREDIT.—Clause (ii) of section 
42(h)(4)(A) is amended by inserting ‘‘or such financing is refunded 
as described in section 146(i)(6)’’ before the period at the end. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to repayments of loans received after the date of the 
enactment of this Act. 
SEC. 3008. COORDINATION OF CERTAIN RULES APPLICABLE TO LOW- 
INCOME HOUSING CREDIT AND QUALIFIED RESIDENTIAL 
RENTAL PROJECT EXEMPT FACILITY BONDS. 
(a) DETERMINATION OF NEXT AVAILABLE UNIT.—Paragraph (3) 
of section 142(d) (relating to current income determinations) is 
amended by adding at the end the following new subparagraph: 
‘‘(C) EXCEPTION FOR PROJECTS WITH RESPECT TO WHICH 
AFFORDABLE HOUSING CREDIT IS ALLOWED.—In the case of 
a project with respect to which credit is allowed under 
section 42, the second sentence of subparagraph (B) shall 
be applied by substituting ‘building (within the meaning 
of section 42)’ for ‘project’.’’. 
(b) STUDENTS.—Paragraph (2) of section 142(d) (relating to 
definitions and special rules) is amended by adding at the end 
the following new subparagraph: 
‘‘(C) 
STUDENTS.—Rules 
similar 
to 
the 
rules 
of 
42(i)(3)(D) shall apply for purposes of this subsection.’’. 
(c) SINGLE-ROOM OCCUPANCY UNITS.—Paragraph (2) of section 
142(d) (relating to definitions and special rules), as amended by 
26 USC 42 
note. 
Applicability. 
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122 STAT. 2887 
PUBLIC LAW 110–289—JULY 30, 2008 
subsection (b), is amended by adding at the end the following 
new subparagraph: 
‘‘(D) SINGLE-ROOM OCCUPANCY UNITS.—A unit shall not 
fail to be treated as a residential unit merely because 
such unit is a single-room occupancy unit (within the 
meaning of section 42).’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to determinations of the status of qualified residential 
rental projects for periods beginning after the date of the enactment 
of this Act, with respect to bonds issued before, on, or after such 
date. 
PART III—REFORMS RELATED TO THE LOW-IN-
COME HOUSING CREDIT AND TAX-EXEMPT 
HOUSING BONDS 
SEC. 3009. HOLD HARMLESS FOR REDUCTIONS IN AREA MEDIAN GROSS 
INCOME. 
(a) IN GENERAL.—Paragraph (2) of section 142(d), as amended 
by section 3008, is amended by adding at the end the following 
new subparagraph: 
‘‘(E) HOLD HARMLESS FOR REDUCTIONS IN AREA MEDIAN 
GROSS INCOME.— 
‘‘(i) IN
GENERAL.—Any determination of area 
median gross income under subparagraph (B) with 
respect to any project for any calendar year after 2008 
shall not be less than the area median gross income 
determined under such subparagraph with respect to 
such project for the calendar year preceding the cal-
endar year for which such determination is made. 
‘‘(ii) 
SPECIAL
RULE
FOR
CERTAIN
CENSUS 
CHANGES.—In the case of a HUD hold harmless 
impacted project, the area median gross income with 
respect to such project for any calendar year after 
2008 (hereafter in this clause referred to as the current 
calendar year) shall be the greater of the amount deter-
mined without regard to this clause or the sum of— 
‘‘(I) the area median gross income determined 
under the HUD hold harmless policy with respect 
to such project for calendar year 2008, plus 
‘‘(II) any increase in the area median gross 
income determined under subparagraph (B) (deter-
mined without regard to the HUD hold harmless 
policy and this subparagraph) with respect to such 
project for the current calendar year over the area 
median gross income (as so determined) with 
respect to such project for calendar year 2008. 
‘‘(iii) HUD HOLD
HARMLESS
POLICY.—The term 
‘HUD hold harmless policy’ means the regulations 
under which a policy similar to the rules of clause 
(i) applied to prevent a change in the method of deter-
mining area median gross income from resulting in 
a reduction in the area median gross income deter-
mined with respect to certain projects in calendar years 
2007 and 2008. 
26 USC 142 
note. 
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122 STAT. 2888 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(iv) HUD HOLD HARMLESS IMPACTED PROJECT.— 
The term ‘HUD hold harmless impacted project’ means 
any project with respect to which area median gross 
income was determined under subparagraph (B) for 
calendar year 2007 or 2008 if such determination would 
have been less but for the HUD hold harmless policy.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to determinations of area median gross income for 
calendar years after 2008. 
SEC. 3010. EXCEPTION TO ANNUAL CURRENT INCOME DETERMINA-
TION REQUIREMENT WHERE DETERMINATION NOT REL-
EVANT. 
(a) IN GENERAL.—Subparagraph (A) of section 142(d)(3) is 
amended by adding at the end the following new sentence: ‘‘The 
preceding sentence shall not apply with respect to any project 
for any year if during such year no residential unit in the project 
is occupied by a new resident whose income exceeds the applicable 
income limit.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to years ending after the date of the enactment of 
this Act. 
Subtitle B—Single Family Housing 
SEC. 3011. FIRST-TIME HOMEBUYER CREDIT. 
(a) IN GENERAL.—Subpart C of part IV of subchapter A of 
chapter 1 is amended by redesignating section 36 as section 37 
and by inserting after section 35 the following new section: 
‘‘SEC. 36. FIRST-TIME HOMEBUYER CREDIT. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an individual who 
is a first-time homebuyer of a principal residence in the United 
States during a taxable year, there shall be allowed as a credit 
against the tax imposed by this subtitle for such taxable year 
an amount equal to 10 percent of the purchase price of the residence. 
‘‘(b) LIMITATIONS.— 
‘‘(1) DOLLAR LIMITATION.— 
‘‘(A) IN
GENERAL.—Except as otherwise provided in 
this paragraph, the credit allowed under subsection (a) 
shall not exceed $7,500. 
‘‘(B) MARRIED INDIVIDUALS FILING SEPARATELY.—In the 
case of a married individual filing a separate return, 
subparagraph (A) shall be applied by substituting ‘$3,750’ 
for ‘$7,500’. 
‘‘(C) OTHER INDIVIDUALS.—If two or more individuals 
who are not married purchase a principal residence, the 
amount of the credit allowed under subsection (a) shall 
be allocated among such individuals in such manner as 
the Secretary may prescribe, except that the total amount 
of the credits allowed to all such individuals shall not 
exceed $7,500. 
‘‘(2) LIMITATION
BASED
ON
MODIFIED
ADJUSTED
GROSS 
INCOME.— 
‘‘(A) IN GENERAL.—The amount allowable as a credit 
under subsection (a) (determined without regard to this 
paragraph) for the taxable year shall be reduced (but not 
26 USC 142 
note. 
26 USC 142 
note. 
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122 STAT. 2889 
PUBLIC LAW 110–289—JULY 30, 2008 
below zero) by the amount which bears the same ratio 
to the amount which is so allowable as— 
‘‘(i) the excess (if any) of— 
‘‘(I) the taxpayer’s modified adjusted gross 
income for such taxable year, over 
‘‘(II) $75,000 ($150,000 in the case of a joint 
return), bears to 
‘‘(ii) $20,000. 
‘‘(B) MODIFIED ADJUSTED GROSS INCOME.—For purposes 
of subparagraph (A), the term ‘modified adjusted gross 
income’ means the adjusted gross income of the taxpayer 
for the taxable year increased by any amount excluded 
from gross income under section 911, 931, or 933. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) FIRST-TIME HOMEBUYER.—The term ‘first-time home-
buyer’ means any individual if such individual (and if married, 
such individual’s spouse) had no present ownership interest 
in a principal residence during the 3-year period ending on 
the date of the purchase of the principal residence to which 
this section applies. 
‘‘(2) PRINCIPAL RESIDENCE.—The term ‘principal residence’ 
has the same meaning as when used in section 121. 
‘‘(3) PURCHASE.— 
‘‘(A) IN
GENERAL.—The term ‘purchase’ means any 
acquisition, but only if— 
‘‘(i) the property is not acquired from a person 
related to the person acquiring such property, and 
‘‘(ii) the basis of the property in the hands of 
the person acquiring such property is not determined— 
‘‘(I) in whole or in part by reference to the 
adjusted basis of such property in the hands of 
the person from whom acquired, or 
‘‘(II) under section 1014(a) (relating to property 
acquired from a decedent). 
‘‘(B) CONSTRUCTION.—A residence which is constructed 
by the taxpayer shall be treated as purchased by the tax-
payer on the date the taxpayer first occupies such resi-
dence. 
‘‘(4) PURCHASE PRICE.—The term ‘purchase price’ means 
the adjusted basis of the principal residence on the date such 
residence is purchased. 
‘‘(5) RELATED
PERSONS.—A person shall be treated as 
related to another person if the relationship between such 
persons would result in the disallowance of losses under section 
267 or 707(b) (but, in applying section 267(b) and (c) for pur-
poses of this section, paragraph (4) of section 267(c) shall be 
treated as providing that the family of an individual shall 
include only his spouse, ancestors, and lineal descendants). 
‘‘(d) EXCEPTIONS.—No credit under subsection (a) shall be 
allowed to any taxpayer for any taxable year with respect to the 
purchase of a residence if— 
‘‘(1) a credit under section 1400C (relating to first-time 
homebuyer in the District of Columbia) is allowable to the 
taxpayer (or the taxpayer’s spouse) for such taxable year or 
any prior taxable year, 
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122 STAT. 2890 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(2) the residence is financed by the proceeds of a qualified 
mortgage issue the interest on which is exempt from tax under 
section 103, 
‘‘(3) the taxpayer is a nonresident alien, or 
‘‘(4) the taxpayer disposes of such residence (or such resi-
dence ceases to be the principal residence of the taxpayer 
(and, if married, the taxpayer’s spouse)) before the close of 
such taxable year. 
‘‘(e) 
REPORTING.—If 
the 
Secretary 
requires 
information 
reporting under section 6045 by a person described in subsection 
(e)(2) thereof to verify the eligibility of taxpayers for the credit 
allowable by this section, the exception provided by section 6045(e) 
shall not apply. 
‘‘(f) RECAPTURE OF CREDIT.— 
‘‘(1) IN GENERAL.—Except as otherwise provided in this 
subsection, if a credit under subsection (a) is allowed to a 
taxpayer, the tax imposed by this chapter shall be increased 
by 62⁄3 percent of the amount of such credit for each taxable 
year in the recapture period. 
‘‘(2) ACCELERATION OF RECAPTURE.—If a taxpayer disposes 
of the principal residence with respect to which a credit was 
allowed under subsection (a) (or such residence ceases to be 
the principal residence of the taxpayer (and, if married, the 
taxpayer’s spouse)) before the end of the recapture period— 
‘‘(A) the tax imposed by this chapter for the taxable 
year of such disposition or cessation shall be increased 
by the excess of the amount of the credit allowed over 
the amounts of tax imposed by paragraph (1) for preceding 
taxable years, and 
‘‘(B) paragraph (1) shall not apply with respect to such 
credit for such taxable year or any subsequent taxable 
year. 
‘‘(3) LIMITATION BASED ON GAIN.—In the case of the sale 
of the principal residence to a person who is not related to 
the taxpayer, the increase in tax determined under paragraph 
(2) shall not exceed the amount of gain (if any) on such sale. 
Solely for purposes of the preceding sentence, the adjusted 
basis of such residence shall be reduced by the amount of 
the credit allowed under subsection (a) to the extent not pre-
viously recaptured under paragraph (1). 
‘‘(4) EXCEPTIONS.— 
‘‘(A) DEATH OF TAXPAYER.—Paragraphs (1) and (2) shall 
not apply to any taxable year ending after the date of 
the taxpayer’s death. 
‘‘(B) INVOLUNTARY CONVERSION.—Paragraph (2) shall 
not apply in the case of a residence which is compulsorily 
or involuntarily converted (within the meaning of section 
1033(a)) if the taxpayer acquires a new principal residence 
during the 2-year period beginning on the date of the 
disposition or cessation referred to in paragraph (2). Para-
graph (2) shall apply to such new principal residence during 
the recapture period in the same manner as if such new 
principal residence were the converted residence. 
‘‘(C) TRANSFERS
BETWEEN
SPOUSES
OR
INCIDENT
TO 
DIVORCE.—In the case of a transfer of a residence to which 
section 1041(a) applies— 
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122 STAT. 2891 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) paragraph (2) shall not apply to such transfer, 
and 
‘‘(ii) in the case of taxable years ending after such 
transfer, paragraphs (1) and (2) shall apply to the 
transferee in the same manner as if such transferee 
were the transferor (and shall not apply to the trans-
feror). 
‘‘(5) JOINT RETURNS.—In the case of a credit allowed under 
subsection (a) with respect to a joint return, half of such credit 
shall be treated as having been allowed to each individual 
filing such return for purposes of this subsection. 
‘‘(6) RETURN REQUIREMENT.—If the tax imposed by this 
chapter for the taxable year is increased under this subsection, 
the taxpayer shall, notwithstanding section 6012, be required 
to file a return with respect to the taxes imposed under this 
subtitle. 
‘‘(7) RECAPTURE PERIOD.—For purposes of this subsection, 
the term ‘recapture period’ means the 15 taxable years begin-
ning with the second taxable year following the taxable year 
in which the purchase of the principal residence for which 
a credit is allowed under subsection (a) was made. 
‘‘(g) ELECTION TO TREAT PURCHASE IN PRIOR YEAR.—In the 
case of a purchase of a principal residence after December 31, 
2008, and before July 1, 2009, a taxpayer may elect to treat such 
purchase as made on December 31, 2008, for purposes of this 
section (other than subsection (c)). 
‘‘(h) APPLICATION OF SECTION.—This section shall only apply 
to a principal residence purchased by the taxpayer on or after 
April 9, 2008, and before July 1, 2009.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 26(b)(2) is amended by striking ‘‘and’’ at the 
end of subparagraph (U), by striking the period and inserting 
‘‘, and’’ and the end of subparagraph (V), and by inserting 
after subparagraph (V) the following new subparagraph: 
‘‘(W) section 36(f) (relating to recapture of homebuyer 
credit).’’. 
(2) Section 6211(b)(4)(A) is amended by striking ‘‘34,’’ and 
all that follows through ‘‘6428’’ and inserting ‘‘34, 35, 36, 53(e), 
and 6428’’. 
(3) Section 1324(b)(2) of title 31, United States Code, is 
amended by inserting ‘‘36,’’ after ‘‘35,’’. 
(4) The table of sections for subpart C of part IV of sub-
chapter A of chapter 1 is amended by redesignating the item 
relating to section 36 as an item relating to section 37 and 
by inserting before such item the following new item: 
‘‘Sec. 36. First-time homebuyer credit.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to residences purchased on or after April 9, 2008, 
in taxable years ending on or after such date. 
SEC. 3012. ADDITIONAL STANDARD DEDUCTION FOR REAL PROPERTY 
TAXES FOR NONITEMIZERS. 
(a) IN GENERAL.—Section 63(c)(1) (defining standard deduction) 
is amended by striking ‘‘and’’ at the end of subparagraph (A), 
by striking the period at the end of subparagraph (B) and inserting 
‘‘, and’’, and by adding at the end the following new subparagraph: 
26 USC 26 
note. 
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122 STAT. 2892 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(C) in the case of any taxable year beginning in 2008, 
the real property tax deduction.’’. 
(b) DEFINITION.—Section 63(c) is amended by adding at the 
end the following new paragraph: 
‘‘(7) REAL PROPERTY TAX DEDUCTION.—For purposes of para-
graph (1), the real property tax deduction is the lesser of— 
‘‘(A) the amount allowable as a deduction under this 
chapter for State and local taxes described in section 
164(a)(1), or 
‘‘(B) $500 ($1,000 in the case of a joint return). 
Any taxes taken into account under section 62(a) shall not 
be taken into account under this paragraph.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2007. 
Subtitle C—General Provisions 
SEC. 3021. TEMPORARY LIBERALIZATION OF TAX-EXEMPT HOUSING 
BOND RULES. 
(a) TEMPORARY INCREASE IN VOLUME CAP.— 
(1) IN GENERAL.—Subsection (d) of section 146 is amended 
by adding at the end the following new paragraph: 
‘‘(5) INCREASE
AND
SET
ASIDE
FOR
HOUSING
BONDS
FOR 
2008.— 
‘‘(A) INCREASE FOR 2008.—In the case of calendar year 
2008, the State ceiling for each State shall be increased 
by an amount equal to $11,000,000,000 multiplied by a 
fraction— 
‘‘(i) the numerator of which is the State ceiling 
applicable to the State for calendar year 2008, deter-
mined without regard to this paragraph, and 
‘‘(ii) the denominator of which is the sum of the 
State ceilings determined under clause (i) for all States. 
‘‘(B) SET ASIDE.— 
‘‘(i) IN GENERAL.—Any amount of the State ceiling 
for any State which is attributable to an increase under 
this paragraph shall be allocated solely for one or 
more qualified housing issues. 
‘‘(ii) QUALIFIED HOUSING ISSUE.—For purposes of 
this paragraph, the term ‘qualified housing issue’ 
means— 
‘‘(I) an issue described in section 142(a)(7) 
(relating to qualified residential rental projects), 
or 
‘‘(II) a qualified mortgage issue (determined 
by substituting ‘12-month period’ for ‘42-month 
period’ 
each 
place 
it 
appears 
in 
section 
143(a)(2)(D)(i)).’’. 
(2) CARRYFORWARD OF UNUSED LIMITATIONS.—Subsection 
(f) of section 146 is amended by adding at the end the following 
new paragraph: 
‘‘(6) SPECIAL RULES FOR INCREASED VOLUME CAP UNDER 
SUBSECTION (d)(5).—No amount which is attributable to the 
increase under subsection (d)(5) may be used— 
‘‘(A) for any issue other than a qualified housing issue 
(as defined in subsection (d)(5)), or 
26 USC 63 
note. 
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122 STAT. 2893 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(B) to issue any bond after calendar year 2010.’’. 
(b) TEMPORARY RULE FOR USE OF QUALIFIED MORTGAGE BONDS 
PROCEEDS FOR SUBPRIME REFINANCING LOANS.— 
(1) IN GENERAL.—Section 143(k) (relating to other defini-
tions and special rules) is amended by adding at the end 
the following new paragraph: 
‘‘(12) SPECIAL RULES FOR SUBPRIME REFINANCINGS.— 
‘‘(A) IN GENERAL.—Notwithstanding the requirements 
of subsection (i)(1), the proceeds of a qualified mortgage 
issue may be used to refinance a mortgage on a residence 
which was originally financed by the mortgagor through 
a qualified subprime loan. 
‘‘(B) SPECIAL
RULES.—In applying subparagraph (A) 
to any refinancing— 
‘‘(i) subsection (a)(2)(D)(i) shall be applied by sub-
stituting ‘12-month period’ for ‘42-month period’ each 
place it appears, 
‘‘(ii) subsection (d) (relating to 3-year requirement) 
shall not apply, and 
‘‘(iii) subsection (e) (relating to purchase price 
requirement) shall be applied by using the market 
value of the residence at the time of refinancing in 
lieu of the acquisition cost. 
‘‘(C) QUALIFIED SUBPRIME LOAN.—The term ‘qualified 
subprime loan’ means an adjustable rate single-family resi-
dential mortgage loan made after December 31, 2001, and 
before January 1, 2008, that the bond issuer determines 
would be reasonably likely to cause financial hardship to 
the borrower if not refinanced. 
‘‘(D) TERMINATION.—This paragraph shall not apply 
to any bonds issued after December 31, 2010.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to bonds issued after the date of the enactment of 
this Act. 
SEC. 3022. REPEAL OF ALTERNATIVE MINIMUM TAX LIMITATIONS ON 
TAX-EXEMPT HOUSING BONDS, LOW-INCOME HOUSING 
TAX CREDIT, AND REHABILITATION CREDIT. 
(a) TAX-EXEMPT
INTEREST
ON
CERTAIN
HOUSING
BONDS 
EXEMPTED FROM ALTERNATIVE MINIMUM TAX.— 
(1) IN
GENERAL.—Subparagraph (C) of section 57(a)(5) 
(relating to specified private activity bonds) is amended by 
redesignating clauses (iii) and (iv) as clauses (iv) and (v), respec-
tively, and by inserting after clause (ii) the following new 
clause: 
‘‘(iii) EXCEPTION FOR CERTAIN HOUSING BONDS.— 
For purposes of clause (i), the term ‘private activity 
bond’ shall not include any bond issued after the date 
of the enactment of this clause if such bond is— 
‘‘(I) an exempt facility bond issued as part 
of an issue 95 percent or more of the net proceeds 
of which are to be used to provide qualified residen-
tial rental projects (as defined in section 142(d)), 
‘‘(II) a qualified mortgage bond (as defined 
in section 143(a)), or 
‘‘(III) a qualified veterans’ mortgage bond (as 
defined in section 143(b)). 
26 USC 143 
note. 
Applicability. 
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122 STAT. 2894 
PUBLIC LAW 110–289—JULY 30, 2008 
The preceding sentence shall not apply to any 
refunding bond unless such preceding sentence applied 
to the refunded bond (or in the case of a series of 
refundings, the original bond).’’. 
(2) NO ADJUSTMENT TO ADJUSTED CURRENT EARNINGS.— 
Subparagraph (B) of section 56(g)(4) is amended by adding 
at the end the following new clause: 
‘‘(iii) TAX EXEMPT INTEREST ON CERTAIN HOUSING 
BONDS.—Clause (i) shall not apply in the case of any 
interest on a bond to which section 57(a)(5)(C)(iii) 
applies.’’. 
(b) ALLOWANCE
OF LOW-INCOME HOUSING CREDIT AGAINST 
ALTERNATIVE MINIMUM TAX.—Subparagraph (B) of section 38(c)(4) 
(relating to specified credits) is amended by redesignating clauses 
(ii) through (iv) as clauses (iii) through (v) and inserting after 
clause (i) the following new clause: 
‘‘(ii) the credit determined under section 42 to the 
extent attributable to buildings placed in service after 
December 31, 2007,’’. 
(c) ALLOWANCE
OF REHABILITATION CREDIT AGAINST ALTER-
NATIVE MINIMUM TAX.—Subparagraph (B) of section 38(c)(4), as 
amended by subsection (b), is amended by striking ‘‘and’’ at the 
end of clause (iv), by redesignating clause (v) as clause (vi), and 
by inserting after clause (iv) the following new clause: 
‘‘(v) the credit determined under section 47 to the 
extent attributable to qualified rehabilitation expendi-
tures properly taken into account for periods after 
December 31, 2007, and’’. 
(d) EFFECTIVE DATE.— 
(1) HOUSING BONDS.—The amendments made by subsection 
(a) shall apply to bonds issued after the date of the enactment 
of this Act. 
(2) LOW INCOME HOUSING CREDIT.—The amendments made 
by subsection (b) shall apply to credits determined under section 
42 of the Internal Revenue Code of 1986 to the extent attrib-
utable to buildings placed in service after December 31, 2007. 
(3) REHABILITATION
CREDIT.—The amendments made by 
subsection (c) shall apply to credits determined under section 
47 of the Internal Revenue Code of 1986 to the extent attrib-
utable to qualified rehabilitation expenditures properly taken 
into account for periods after December 31, 2007. 
SEC. 3023. BONDS GUARANTEED BY FEDERAL HOME LOAN BANKS 
ELIGIBLE FOR TREATMENT AS TAX-EXEMPT BONDS. 
(a) IN
GENERAL.—Subparagraph (A) of section 149(b)(3) 
(relating to exceptions for certain insurance programs) is amended 
by striking ‘‘or’’ at the end of clause (ii), by striking the period 
at the end of clause (iii) and inserting ‘‘, or’’ and by adding at 
the end the following new clause: 
‘‘(iv) subject to subparagraph (E), any guarantee 
by a Federal home loan bank made in connection with 
the original issuance of a bond during the period begin-
ning on the date of the enactment of this clause and 
ending on December 31, 2010 (or a renewal or exten-
sion of a guarantee so made).’’. 
26 USC 38 
note. 
26 USC 38 
note. 
26 USC 56 
note. 
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122 STAT. 2895 
PUBLIC LAW 110–289—JULY 30, 2008 
(b) SAFETY AND SOUNDNESS REQUIREMENTS.—Paragraph (3) of 
section 149(b) is amended by adding at the end the following new 
subparagraph: 
‘‘(E) SAFETY AND SOUNDNESS REQUIREMENTS FOR FED-
ERAL HOME LOAN BANKS.—Clause (iv) of subparagraph (A) 
shall not apply to any guarantee by a Federal home loan 
bank unless such bank meets safety and soundness collat-
eral requirements for such guarantees which are at least 
as stringent as such requirements which apply under regu-
lations applicable to such guarantees by Federal home 
loan banks as in effect on April 9, 2008.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to guarantees made after the date of the enactment 
of this Act. 
SEC. 3024. MODIFICATION OF RULES PERTAINING TO FIRPTA NONFOR-
EIGN AFFIDAVITS. 
(a) IN GENERAL.—Subsection (b) of section 1445 (relating to 
exemptions) is amended by adding at the end the following: 
‘‘(9) ALTERNATIVE PROCEDURE FOR FURNISHING NONFOREIGN 
AFFIDAVIT.—For purposes of paragraphs (2) and (7)— 
‘‘(A) IN GENERAL.—Paragraph (2) shall be treated as 
applying to a transaction if, in connection with a disposition 
of a United States real property interest— 
‘‘(i) the affidavit specified in paragraph (2) is fur-
nished to a qualified substitute, and 
‘‘(ii) the qualified substitute furnishes a statement 
to the transferee stating, under penalty of perjury, 
that the qualified substitute has such affidavit in his 
possession. 
‘‘(B) REGULATIONS.—The Secretary shall prescribe such 
regulations as may be necessary or appropriate to carry 
out this paragraph.’’. 
(b) QUALIFIED SUBSTITUTE.—Subsection (f) of section 1445 
(relating to definitions) is amended by adding at the end the fol-
lowing new paragraph: 
‘‘(6) QUALIFIED SUBSTITUTE.—The term ‘qualified substitute’ 
means, with respect to a disposition of a United States real 
property interest— 
‘‘(A) the person (including any attorney or title com-
pany) responsible for closing the transaction, other than 
the transferor’s agent, and 
‘‘(B) the transferee’s agent.’’. 
(c) EXEMPTION NOT TO APPLY IF KNOWLEDGE OR NOTICE THAT 
AFFIDAVIT OR STATEMENT IS FALSE.— 
(1) IN GENERAL.—Paragraph (7) of section 1445(b) (relating 
to special rules for paragraphs (2) and (3)) is amended to 
read as follows: 
‘‘(7) SPECIAL RULES FOR PARAGRAPHS (2), (3), AND (9).—Para-
graph (2), (3), or (9) (as the case may be) shall not apply 
to any disposition— 
‘‘(A) if— 
‘‘(i) the transferee or qualified substitute has actual 
knowledge that the affidavit referred to in such para-
graph, or the statement referred to in paragraph 
(9)(A)(ii), is false, or 
26 USC 149 
note. 
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122 STAT. 2896 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) the transferee or qualified substitute receives 
a notice (as described in subsection (d)) from a trans-
feror’s agent, transferee’s agent, or qualified substitute 
that such affidavit or statement is false, or 
‘‘(B) if the Secretary by regulations requires the trans-
feree or qualified substitute to furnish a copy of such affi-
davit or statement to the Secretary and the transferee 
or qualified substitute fails to furnish a copy of such affi-
davit or statement to the Secretary at such time and in 
such manner as required by such regulations.’’. 
(2) LIABILITY.— 
(A) NOTICE.—Paragraph (1) of section 1445(d) (relating 
to notice of false affidavit; foreign corporations) is amended 
to read as follows: 
‘‘(1) NOTICE OF FALSE AFFIDAVIT; FOREIGN CORPORATIONS.— 
If— 
‘‘(A) the transferor furnishes the transferee or qualified 
substitute an affidavit described in paragraph (2) of sub-
section (b) or a domestic corporation furnishes the trans-
feree an affidavit described in paragraph (3) of subsection 
(b), and 
‘‘(B) in the case of— 
‘‘(i) any transferor’s agent— 
‘‘(I) such agent has actual knowledge that such 
affidavit is false, or 
‘‘(II) in the case of an affidavit described in 
subsection (b)(2) furnished by a corporation, such 
corporation is a foreign corporation, or 
‘‘(ii) any transferee’s agent or qualified substitute, 
such agent or substitute has actual knowledge that 
such affidavit is false, 
such agent or qualified substitute shall so notify the trans-
feree at such time and in such manner as the Secretary 
shall require by regulations.’’. 
(B) FAILURE
TO
FURNISH
NOTICE.—Paragraph (2) of 
section 1445(d) (relating to failure to furnish notice) is 
amended to read as follows: 
‘‘(2) FAILURE TO FURNISH NOTICE.— 
‘‘(A) IN
GENERAL.—If any transferor’s agent, trans-
feree’s agent, or qualified substitute is required by para-
graph (1) to furnish notice, but fails to furnish such notice 
at such time or times and in such manner as may be 
required by regulations, such agent or substitute shall have 
the same duty to deduct and withhold that the transferee 
would have had if such agent or substitute had complied 
with paragraph (1). 
‘‘(B) LIABILITY
LIMITED
TO
AMOUNT
OF
COMPENSA-
TION.—An agent’s or substitute’s liability under subpara-
graph (A) shall be limited to the amount of compensation 
the agent or substitute derives from the transaction.’’. 
(C) CONFORMING AMENDMENT.—The heading for sec-
tion 1445(d) is amended by striking ‘‘OR TRANSFEREE’S 
AGENTS’’ and inserting ‘‘, TRANSFEREE’S AGENTS, OR QUALI-
FIED SUBSTITUTES’’. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to dispositions of United States real property interests 
after the date of the enactment of this Act. 
Real property. 
26 USC 1445 
note. 
Regulations. 
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122 STAT. 2897 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 3025. MODIFICATION OF DEFINITION OF TAX-EXEMPT USE PROP-
ERTY FOR PURPOSES OF THE REHABILITATION CREDIT. 
(a) IN GENERAL.—Subclause (I) of section 47(c)(2)(B)(v) is 
amended by striking ‘‘section 168(h)’’ and inserting ‘‘section 168(h), 
except that ‘50 percent’ shall be substituted for ‘35 percent’ in 
paragraph (1)(B)(iii) thereof’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to expenditures properly taken into account for periods 
after December 31, 2007. 
SEC. 3026. EXTENSION OF SPECIAL RULE FOR MORTGAGE REVENUE 
BONDS FOR RESIDENCES LOCATED IN DISASTER AREAS. 
(a) IN GENERAL.—Paragraph (11) of section 143(k) is amended— 
(1) by striking ‘‘December 31, 1996’’ and inserting ‘‘May 
1, 2008’’, and 
(2) by striking ‘‘January 1, 1999’’ and inserting ‘‘January 
1, 2010’’. 
(b) EFFECTIVE DATE.—The amendments made by this section 
shall apply to bonds issued after May 1, 2008. 
SEC. 3027. TRANSFER OF FUNDS APPROPRIATED TO CARRY OUT 2008 
RECOVERY REBATES FOR INDIVIDUALS. 
Of the funds made available by section 101(e)(1)(A) of the 
Economic Stimulus Act of 2008 (Public Law 110-185), the Secretary 
of the Treasury may transfer funds among the accounts specified 
in such section to carry out section 6428 of the Internal Revenue 
Code of 1986. The Secretary shall provide advance notification 
of any such transfer to the Committees on Appropriations of the 
House of Representatives and the Senate, and any transfer greater 
than $5,000,000 shall be subject to the approval of such Committees. 
TITLE II—REFORMS RELATED TO REAL 
ESTATE INVESTMENT TRUSTS 
Subtitle A—Foreign Currency and Other 
Qualified Activities 
SEC. 3031. REVISIONS TO REIT INCOME TESTS. 
(a) FOREIGN CURRENCY GAINS NOT GROSS INCOME IN APPLYING 
REIT INCOME TESTS.—Section 856 (defining real estate investment 
trust) is amended by adding at the end the following new subsection: 
‘‘(n) RULES REGARDING FOREIGN CURRENCY TRANSACTIONS.— 
‘‘(1) IN GENERAL.—For purposes of this part— 
‘‘(A) passive foreign exchange gain for any taxable year 
shall not constitute gross income for purposes of subsection 
(c)(2), and 
‘‘(B) real estate foreign exchange gain for any taxable 
year shall not constitute gross income for purposes of sub-
section (c)(3). 
‘‘(2) REAL ESTATE FOREIGN EXCHANGE GAIN.—For purposes 
of this subsection, the term ‘real estate foreign exchange gain’ 
means— 
‘‘(A) foreign currency gain (as defined in section 
988(b)(1)) which is attributable to— 
Notification. 
26 USC 143 
note. 
26 USC 47 
note. 
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122 STAT. 2898 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) any item of income or gain described in sub-
section (c)(3), 
‘‘(ii) the acquisition or ownership of obligations 
secured by mortgages on real property or on interests 
in real property (other than foreign currency gain 
attributable to any item of income or gain described 
in clause (i)), or 
‘‘(iii) becoming or being the obligor under obliga-
tions secured by mortgages on real property or on 
interests in real property (other than foreign currency 
gain attributable to any item of income or gain 
described in clause (i)), 
‘‘(B) section 987 gain attributable to a qualified busi-
ness unit (as defined by section 989) of the real estate 
investment trust, but only if such qualified business unit 
meets the requirements under— 
‘‘(i) subsection (c)(3) for the taxable year, and 
‘‘(ii) subsection (c)(4)(A) at the close of each quarter 
that the real estate investment trust has directly or 
indirectly held the qualified business unit, and 
‘‘(C) any other foreign currency gain as determined 
by the Secretary. 
‘‘(3) PASSIVE FOREIGN EXCHANGE GAIN.—For purposes of 
this subsection, the term ‘passive foreign exchange gain’ 
means— 
‘‘(A) real estate foreign exchange gain, 
‘‘(B) foreign currency gain (as defined in section 
988(b)(1)) which is not described in subparagraph (A) and 
which is attributable to— 
‘‘(i) any item of income or gain described in sub-
section (c)(2), 
‘‘(ii) the acquisition or ownership of obligations 
(other than foreign currency gain attributable to any 
item of income or gain described in clause (i)), or 
‘‘(iii) becoming or being the obligor under obliga-
tions (other than foreign currency gain attributable 
to any item of income or gain described in clause 
(i)), and 
‘‘(C) any other foreign currency gain as determined 
by the Secretary. 
‘‘(4) EXCEPTION FOR INCOME FROM SUBSTANTIAL AND REG-
ULAR TRADING.—Notwithstanding this subsection or any other 
provision of this part, any section 988 gain derived by a corpora-
tion, trust, or association from dealing, or engaging in substan-
tial and regular trading, in securities (as defined in section 
475(c)(2)) shall constitute gross income which does not qualify 
under paragraph (2) or (3) of subsection (c). This paragraph 
shall not apply to income which does not constitute gross income 
by reason of subsection (c)(5)(G).’’. 
(b) ADDITION TO REIT HEDGING RULE.—Subparagraph (G) of 
section 856(c)(5) is amended to read as follows: 
‘‘(G) TREATMENT OF CERTAIN HEDGING INSTRUMENTS.— 
Except to the extent as determined by the Secretary— 
‘‘(i) any income of a real estate investment trust 
from a hedging transaction (as defined in clause (ii) 
or (iii) of section 1221(b)(2)(A)) which is clearly identi-
fied pursuant to section 1221(a)(7), including gain from 
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122 STAT. 2899 
PUBLIC LAW 110–289—JULY 30, 2008 
the sale or disposition of such a transaction, shall 
not constitute gross income under paragraphs (2) and 
(3) to the extent that the transaction hedges any 
indebtedness incurred or to be incurred by the trust 
to acquire or carry real estate assets, and 
‘‘(ii) any income of a real estate investment trust 
from a transaction entered into by the trust primarily 
to manage risk of currency fluctuations with respect 
to any item of income or gain described in paragraph 
(2) or (3) (or any property which generates such income 
or gain), including gain from the termination of such 
a transaction, shall not constitute gross income under 
paragraphs (2) and (3), but only if such transaction 
is clearly identified as such before the close of the 
day on which it was acquired, originated, or entered 
into (or such other time as the Secretary may pre-
scribe).’’. 
(c) AUTHORITY
TO EXCLUDE ITEMS
OF INCOME FROM REIT 
INCOME TESTS.—Section 856(c)(5) is amended by adding at the 
end the following new subparagraph: 
‘‘(J) SECRETARIAL AUTHORITY TO EXCLUDE OTHER ITEMS 
OF INCOME.—To the extent necessary to carry out the pur-
poses of this part, the Secretary is authorized to determine, 
solely for purposes of this part, whether any item of income 
or gain which— 
‘‘(i) does not otherwise qualify under paragraph 
(2) or (3) may be considered as not constituting gross 
income for purposes of paragraphs (2) or (3), or 
‘‘(ii) otherwise constitutes gross income not quali-
fying under paragraph (2) or (3) may be considered 
as gross income which qualifies under paragraph (2) 
or (3).’’. 
SEC. 3032. REVISIONS TO REIT ASSET TESTS. 
(a) CLARIFICATION OF VALUATION TEST.—The first sentence in 
the matter following section 856(c)(4)(B)(iii)(III) is amended by 
inserting ‘‘(including a discrepancy caused solely by the change 
in the foreign currency exchange rate used to value a foreign 
asset)’’ after ‘‘such requirements’’. 
(b) CLARIFICATION OF PERMISSIBLE ASSET CATEGORY.—Section 
856(c)(5), as amended by section 3031(c), is amended by adding 
at the end the following new subparagraph: 
‘‘(K) CASH.—If the real estate investment trust or its 
qualified business unit (as defined in section 989) uses 
any foreign currency as its functional currency (as defined 
in section 985(b)), the term ‘cash’ includes such foreign 
currency but only to the extent such foreign currency— 
‘‘(i) is held for use in the normal course of the 
activities of the trust or qualified business unit which 
give rise to items of income or gain described in para-
graph (2) or (3) of subsection (c) or are directly related 
to acquiring or holding assets described in subsection 
(c)(4), and 
‘‘(ii) is not held in connection with an activity 
described in subsection (n)(4).’’. 
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122 STAT. 2900 
PUBLIC LAW 110–289—JULY 30, 2008 
SEC. 3033. CONFORMING FOREIGN CURRENCY REVISIONS. 
(a) NET INCOME FROM FORECLOSURE PROPERTY.—Clause (i) 
of section 857(b)(4)(B) is amended to read as follows: 
‘‘(i) gain (including any foreign currency gain, as 
defined in section 988(b)(1)) from the sale or other 
disposition of foreclosure property described in section 
1221(a)(1) and the gross income for the taxable year 
derived from foreclosure property (as defined in section 
856(e)), but only to the extent such gross income is 
not described in (or, in the case of foreign currency 
gain, not attributable to gross income described in) 
section 856(c)(3) other than subparagraph (F) thereof, 
over’’. 
(b) NET INCOME FROM PROHIBITED TRANSACTIONS.—Clause (i) 
of section 857(b)(6)(B) is amended to read as follows: 
‘‘(i) the term ‘net income derived from prohibited 
transactions’ means the excess of the gain (including 
any foreign currency gain, as defined in section 
988(b)(1)) from prohibited transactions over the deduc-
tions (including any foreign currency loss, as defined 
in section 988(b)(2)) allowed by this chapter which 
are directly connected with prohibited transactions;’’. 
Subtitle B—Taxable REIT Subsidiaries 
SEC. 3041. CONFORMING TAXABLE REIT SUBSIDIARY ASSET TEST. 
Section 856(c)(4)(B)(ii) is amended— 
(1) by striking ‘‘20 percent’’ and inserting ‘‘25 percent’’, 
and 
(2) by striking ‘‘REIT subsidiaries’’ and all that follows, 
and inserting ‘‘REIT subsidiaries,’’. 
Subtitle C—Dealer Sales 
SEC. 3051. HOLDING PERIOD UNDER SAFE HARBOR. 
(a) IN GENERAL.—Section 857(b)(6) (relating to income from 
prohibited transactions) is amended— 
(1) by striking ‘‘4 years’’ in subparagraphs (C)(i), (C)(iv), 
and (D)(i) and inserting ‘‘2 years’’, 
(2) by striking ‘‘4-year period’’ in subparagraphs (C)(ii), 
(D)(ii), and (D)(iii) and inserting ‘‘2-year period’’, and 
(3) by striking ‘‘real estate asset’’and all that follows 
through ‘‘if’’ in the matter preceding clause (i) of subparagraphs 
(C) and (D), respectively, and inserting ‘‘real estate asset (as 
defined in section 856(c)(5)(B)) and which is described in section 
1221(a)(1) if’’. 
(b) RETENTION
OF
EXISTING
LAW.—Section 857(b)(6) is 
amended— 
(1) by striking subparagraph (G) and redesignating sub-
paragraphs (H) and (I) as subparagraphs (G) and (H), respec-
tively, and 
(2) in subparagraph (G), as so redesignated, by adding 
at the end the following: ‘‘For purposes of the preceding sen-
tence, the reference to subparagraph (D) shall be a reference 
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122 STAT. 2901 
PUBLIC LAW 110–289—JULY 30, 2008 
to such subparagraph as in effect on the day before the enact-
ment of the Housing Assistance Tax Act of 2008, as modified 
by subparagraph (G) as so in effect.’’. 
SEC. 3052. DETERMINING VALUE OF SALES UNDER SAFE HARBOR. 
Section 857(b)(6) is amended— 
(1) by striking the semicolon at the end of subparagraph 
(C)(iii) and inserting ‘‘, or (III) the fair market value of property 
(other than sales of foreclosure property or sales to which 
section 1033 applies) sold during the taxable year does not 
exceed 10 percent of the fair market value of all of the assets 
of the trust as of the beginning of the taxable year;’’, and 
(2) by adding ‘‘or’’ at the end of subclause (II) of subpara-
graph (D)(iv) and by adding at the end of such subparagraph 
the following new subclause: 
‘‘(III) the fair market value of property (other than 
sales of foreclosure property or sales to which section 
1033 applies) sold during the taxable year does not 
exceed 10 percent of the fair market value of all of 
the assets of the trust as of the beginning of the 
taxable year,’’. 
Subtitle D—Health Care REITs 
SEC. 3061. CONFORMITY FOR HEALTH CARE FACILITIES. 
(a) RELATED PARTY RENTALS.—Subparagraph (B) of section 
856(d)(8) (relating to special rule for taxable REIT subsidiaries) 
is amended to read as follows: 
‘‘(B) EXCEPTION FOR CERTAIN LODGING FACILITIES AND 
HEALTH
CARE
PROPERTY.—The 
requirements 
of 
this 
subparagraph are met with respect to an interest in real 
property which is a qualified lodging facility (as defined 
in paragraph (9)(D)) or a qualified health care property 
(as defined in subsection (e)(6)(D)(i)) leased by the trust 
to a taxable REIT subsidiary of the trust if the property 
is operated on behalf of such subsidiary by a person who 
is an eligible independent contractor. For purposes of this 
section, a taxable REIT subsidiary is not considered to 
be operating or managing a qualified health care property 
or qualified lodging facility solely because it— 
‘‘(i) directly or indirectly possesses a license, 
permit, or similar instrument enabling it to do so, 
or 
‘‘(ii) employs individuals working at such facility 
or property located outside the United States, but only 
if an eligible independent contractor is responsible for 
the daily supervision and direction of such individuals 
on behalf of the taxable REIT subsidiary pursuant 
to a management agreement or similar service con-
tract.’’. 
(b) ELIGIBLE INDEPENDENT CONTRACTOR.—Subparagraphs (A) 
and (B) of section 856(d)(9) (relating to eligible independent con-
tractor) are amended to read as follows: 
‘‘(A) IN GENERAL.—The term ‘eligible independent con-
tractor’ means, with respect to any qualified lodging facility 
or qualified health care property (as defined in subsection 
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122 STAT. 2902 
PUBLIC LAW 110–289—JULY 30, 2008 
(e)(6)(D)(i)), any independent contractor if, at the time such 
contractor enters into a management agreement or other 
similar service contract with the taxable REIT subsidiary 
to operate such qualified lodging facility or qualified health 
care property, such contractor (or any related person) is 
actively engaged in the trade or business of operating quali-
fied lodging facilities or qualified health care properties, 
respectively, for any person who is not a related person 
with respect to the real estate investment trust or the 
taxable REIT subsidiary. 
‘‘(B) SPECIAL RULES.—Solely for purposes of this para-
graph and paragraph (8)(B), a person shall not fail to 
be treated as an independent contractor with respect to 
any qualified lodging facility or qualified health care prop-
erty (as so defined) by reason of the following: 
‘‘(i) The taxable REIT subsidiary bears the 
expenses for the operation of such qualified lodging 
facility or qualified health care property pursuant to 
the management agreement or other similar service 
contract. 
‘‘(ii) The taxable REIT subsidiary receives the reve-
nues from the operation of such qualified lodging 
facility or qualified health care property, net of 
expenses for such operation and fees payable to the 
operator pursuant to such agreement or contract. 
‘‘(iii) The real estate investment trust receives 
income from such person with respect to another prop-
erty that is attributable to a lease of such other prop-
erty to such person that was in effect as of the later 
of— 
‘‘(I) January 1, 1999, or 
‘‘(II) the earliest date that any taxable REIT 
subsidiary of such trust entered into a manage-
ment agreement or other similar service contract 
with such person with respect to such qualified 
lodging facility or qualified health care property.’’. 
(c) TAXABLE REIT SUBSIDIARIES.—The last sentence of section 
856(l)(3) is amended— 
(1) by inserting ‘‘or a health care facility’’ after ‘‘a lodging 
facility’’, and 
(2) by inserting ‘‘or health care facility’’ after ‘‘such lodging 
facility’’. 
Subtitle E—Effective Dates 
SEC. 3071. EFFECTIVE DATES. 
(a) IN GENERAL.—Except as otherwise provided in this section, 
the amendments made by this title shall apply to taxable years 
beginning after the date of the enactment of this Act. 
(b) REIT INCOME TESTS.— 
(1) The amendments made by section 3031(a) and (c) shall 
apply to gains and items of income recognized after the date 
of the enactment of this Act. 
(2) The amendment made by section 3031(b) shall apply 
to transactions entered into after the date of the enactment 
of this Act. 
26 USC 856 
note. 
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122 STAT. 2903 
PUBLIC LAW 110–289—JULY 30, 2008 
(c) CONFORMING FOREIGN CURRENCY REVISIONS.— 
(1) The amendment made by section 3033(a) shall apply 
to gains recognized after the date of the enactment of this 
Act. 
(2) The amendment made by section 3033(b) shall apply 
to gains and deductions recognized after the date of the enact-
ment of this Act. 
(d) DEALER SALES.—The amendments made by subtitle C shall 
apply to sales made after the date of the enactment of this Act. 
TITLE III—REVENUE PROVISIONS 
Subtitle A—General Provisions 
SEC. 3081. ELECTION TO ACCELERATE THE AMT AND RESEARCH 
CREDITS IN LIEU OF BONUS DEPRECIATION. 
(a) IN GENERAL.—Section 168(k) is amended by adding at the 
end the following new paragraph: 
‘‘(4) ELECTION
TO
ACCELERATE
THE
AMT
AND
RESEARCH 
CREDITS IN LIEU OF BONUS DEPRECIATION.— 
‘‘(A) IN GENERAL.—If a corporation elects to have this 
paragraph apply for the first taxable year of the taxpayer 
ending after March 31, 2008, in the case of such taxable 
year and each subsequent taxable year— 
‘‘(i) paragraph (1) shall not apply to any eligible 
qualified property placed in service by the taxpayer, 
‘‘(ii) the applicable depreciation method used under 
this section with respect to such property shall be 
the straight line method, and 
‘‘(iii) each of the limitations described in subpara-
graph (B) for any such taxable year shall be increased 
by the bonus depreciation amount which is— 
‘‘(I) determined for such taxable year under 
subparagraph (C), and 
‘‘(II) 
allocated 
to 
such 
limitation 
under 
subparagraph (E). 
‘‘(B) LIMITATIONS TO BE INCREASED.—The limitations 
described in this subparagraph are— 
‘‘(i) the limitation imposed by section 38(c), and 
‘‘(ii) the limitation imposed by section 53(c). 
‘‘(C) BONUS DEPRECIATION AMOUNT.—For purposes of 
this paragraph— 
‘‘(i) IN GENERAL.—The bonus depreciation amount 
for any taxable year is an amount equal to 20 percent 
of the excess (if any) of— 
‘‘(I) the aggregate amount of depreciation 
which would be allowed under this section for 
eligible qualified property placed in service by the 
taxpayer during such taxable year if paragraph 
(1) applied to all such property, over 
‘‘(II) the aggregate amount of depreciation 
which would be allowed under this section for 
eligible qualified property placed in service by the 
taxpayer during such taxable year if paragraph 
(1) did not apply to any such property. 
Applicability. 
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122 STAT. 2904 
PUBLIC LAW 110–289—JULY 30, 2008 
The aggregate amounts determined under subclauses 
(I) and (II) shall be determined without regard to any 
election made under subsection (b)(2)(C), (b)(3)(D), or 
(g)(7) and without regard to subparagraph (A)(ii). 
‘‘(ii) MAXIMUM AMOUNT.—The bonus depreciation 
amount for any taxable year shall not exceed the max-
imum increase amount under clause (iii), reduced (but 
not below zero) by the sum of the bonus depreciation 
amounts for all preceding taxable years. 
‘‘(iii) MAXIMUM INCREASE AMOUNT.—For purposes 
of clause (ii), the term ‘maximum increase amount’ 
means, with respect to any corporation, the lesser of— 
‘‘(I) $30,000,000, or 
‘‘(II) 6 percent of the sum of the business credit 
increase amount, and the AMT credit increase 
amount, determined with respect to such corpora-
tion under subparagraph (E). 
‘‘(iv) AGGREGATION RULE.—All corporations which 
are treated as a single employer under section 52(a) 
shall be treated— 
‘‘(I) as 1 taxpayer for purposes of this para-
graph, and 
‘‘(II) as having elected the application of this 
paragraph if any such corporation so elects. 
‘‘(D) ELIGIBLE QUALIFIED PROPERTY.—For purposes of 
this paragraph, the term ‘eligible qualified property’ means 
qualified property under paragraph (2), except that in 
applying paragraph (2) for purposes of this paragraph— 
‘‘(i) ‘March 31, 2008’ shall be substituted for 
‘December 31, 2007’ each place it appears in subpara-
graph (A) and clauses (i) and (ii) of subparagraph 
(E) thereof, and 
‘‘(ii) only adjusted basis attributable to manufac-
ture, construction, or production after March 31, 2008, 
and before January 1, 2009, shall be taken into account 
under subparagraph (B)(ii) thereof. 
‘‘(E) ALLOCATION OF BONUS DEPRECIATION AMOUNTS.— 
‘‘(i) IN GENERAL.—Subject to clauses (ii) and (iii), 
the taxpayer shall, at such time and in such manner 
as the Secretary may prescribe, specify the portion 
(if any) of the bonus depreciation amount for the tax-
able year which is to be allocated to each of the limita-
tions described in subparagraph (B) for such taxable 
year. 
‘‘(ii) LIMITATION ON ALLOCATIONS.—The portion of 
the bonus depreciation amount which may be allocated 
under clause (i) to the limitations described in subpara-
graph (B) for any taxable year shall not exceed— 
‘‘(I) in the case of the limitation described in 
subparagraph (B)(i), the excess of the business 
credit increase amount over the bonus depreciation 
amount allocated to such limitation for all pre-
ceding taxable years, and 
‘‘(II) in the case of the limitation described 
in subparagraph (B)(ii), the excess of the AMT 
credit increase amount over the bonus depreciation 
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122 STAT. 2905 
PUBLIC LAW 110–289—JULY 30, 2008 
amount allocated to such limitation for all pre-
ceding taxable years. 
‘‘(iii) BUSINESS
CREDIT
INCREASE
AMOUNT.—For 
purposes of this paragraph, the term ‘business credit 
increase amount’ means the amount equal to the por-
tion of the credit allowable under section 38 (deter-
mined without regard to subsection (c) thereof) for 
the first taxable year ending after March 31, 2008, 
which is allocable to business credit carryforwards to 
such taxable year which are— 
‘‘(I) from taxable years beginning before 
January 1, 2006, and 
‘‘(II) properly allocable (determined under the 
rules of section 38(d)) to the research credit deter-
mined under section 41(a). 
‘‘(iv) AMT CREDIT
INCREASE
AMOUNT.—For pur-
poses of this paragraph, the term ‘AMT credit increase 
amount’ means the amount equal to the portion of 
the minimum tax credit under section 53(b) for the 
first taxable year ending after March 31, 2008, deter-
mined by taking into account only the adjusted min-
imum tax for taxable years beginning before January 
1, 2006. For purposes of the preceding sentence, credits 
shall be treated as allowed on a first-in, first-out basis. 
‘‘(F) CREDIT
REFUNDABLE.—For purposes of section 
6401(b), the aggregate increase in the credits allowable 
under part IV of subchapter A for any taxable year 
resulting from the application of this paragraph shall be 
treated as allowed under subpart C of such part (and 
not any other subpart). 
‘‘(G) OTHER RULES.— 
‘‘(i) ELECTION.—Any election under this paragraph 
(including any allocation under subparagraph (E)) may 
be revoked only with the consent of the Secretary. 
‘‘(ii) PARTNERSHIPS WITH ELECTING PARTNERS.—In 
the case of a corporation making an election under 
subparagraph (A) and which is a partner in a partner-
ship, for purposes of determining such corporation’s 
distributive share of partnership items under section 
702— 
‘‘(I) paragraph (1) shall not apply to any 
eligible qualified property, and 
‘‘(II) the applicable depreciation method used 
under this section with respect to such property 
shall be the straight line method. 
‘‘(iii) SPECIAL
RULE
FOR
PASSENGER
AIRCRAFT.— 
In the case of any passenger aircraft, the written 
binding 
contract 
limitation 
under 
paragraph 
(2)(A)(iii)(I) shall not apply for purposes of subpara-
graphs (C)(i)(I) and (D).’’. 
(b) APPLICATION TO CERTAIN AUTOMOTIVE PARTNERSHIPS.— 
(1) IN GENERAL.—If an applicable partnership elects the 
application of this subsection— 
(A) the partnership shall be treated as having made 
a payment against the tax imposed by chapter 1 of the 
Internal Revenue Code of 1986 for any applicable taxable 
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122 STAT. 2906 
PUBLIC LAW 110–289—JULY 30, 2008 
year of the partnership in the amount determined under 
paragraph (3), 
(B) in the case of any eligible qualified property placed 
in service by the partnership during any applicable taxable 
year— 
(i) section 168(k) of such Code shall not apply 
in determining the amount of the deduction allowable 
with respect to such property under section 168 of 
such Code, 
(ii) the applicable depreciation method used with 
respect to such property shall be the straight line 
method, and 
(C) the amount of the credit determined under section 
41 of such Code for any applicable taxable year with respect 
to the partnership shall be reduced by the amount of the 
deemed payment under subparagraph (A) for the taxable 
year. 
(2) TREATMENT OF DEEMED PAYMENT.— 
(A) IN GENERAL.—Notwithstanding any other provision 
of the Internal Revenue Code of 1986, the Secretary of 
the Treasury or his delegate shall not use the payment 
of tax described in paragraph (1) as an offset or credit 
against any tax liability of the applicable partnership or 
any partner but shall refund such payment to the 
applicable partnership. 
(B) NO
INTEREST.—The payment described in para-
graph (1) shall not be taken into account in determining 
any amount of interest under such Code. 
(3) AMOUNT OF DEEMED PAYMENT.—The amount determined 
under this paragraph for any applicable taxable year shall 
be the least of the following: 
(A) The amount which would be determined for the 
taxable year under section 168(k)(4)(C)(i) of the Internal 
Revenue Code of 1986 (as added by the amendments made 
by this section) if an election under section 168(k)(4) of 
such Code were in effect with respect to the partnership. 
(B) The amount of the credit determined under section 
41 of such Code for the taxable year with respect to the 
partnership. 
(C) $30,000,000, reduced by the amount of any pay-
ment under this subsection for any preceding taxable year. 
(4) DEFINITIONS.—For purposes of this subsection— 
(A) APPLICABLE PARTNERSHIP.—The term ‘‘applicable 
partnership’’ means a domestic partnership that— 
(i) was formed effective on August 3, 2007, and 
(ii) will produce in excess of 675,000 automobiles 
during the period beginning on January 1, 2008, and 
ending on June 30, 2008. 
(B) APPLICABLE TAXABLE YEAR.—The term ‘‘applicable 
taxable year’’ means any taxable year during which eligible 
qualified property is placed in service. 
(C) ELIGIBLE QUALIFIED PROPERTY.—The term ‘‘eligible 
qualified property’’ has the meaning given such term by 
section 168(k)(4)(D) of the Internal Revenue Code of 1986 
(as added by the amendments made by this section). 
(c) CONFORMING AMENDMENT.—Section 1324(b)(2) of title 31, 
United States Code, as amended by this Act, is amended— 
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122 STAT. 2907 
PUBLIC LAW 110–289—JULY 30, 2008 
(1) by inserting ‘‘168(k)(4)(F),’’ after ‘‘36,’’, and 
(2) by inserting ‘‘, or due under section 3081(b)(2) of the 
Housing Assistance Tax Act of 2008’’ before the period at the 
end. 
(d) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years ending after March 31, 2008. 
SEC. 3082. CERTAIN GO ZONE INCENTIVES. 
(a) USE OF AMENDED INCOME TAX RETURNS TO TAKE INTO 
ACCOUNT RECEIPT OF CERTAIN HURRICANE-RELATED CASUALTY LOSS 
GRANTS
BY
DISALLOWING
PREVIOUSLY
TAKEN
CASUALTY
LOSS 
DEDUCTIONS.— 
(1) IN GENERAL.—Notwithstanding any other provision of 
the Internal Revenue Code of 1986, if a taxpayer claims a 
deduction for any taxable year with respect to a casualty loss 
to a principal residence (within the meaning of section 121 
of such Code) resulting from Hurricane Katrina, Hurricane 
Rita, or Hurricane Wilma and in a subsequent taxable year 
receives a grant under Public Law 109–148, 109–234, or 110– 
116 as reimbursement for such loss, such taxpayer may elect 
to file an amended income tax return for the taxable year 
in which such deduction was allowed (and for any taxable 
year to which such deduction is carried) and reduce (but not 
below zero) the amount of such deduction by the amount of 
such reimbursement. 
(2) TIME OF FILING AMENDED RETURN.—Paragraph (1) shall 
apply with respect to any grant only if any amended income 
tax returns with respect to such grant are filed not later than 
the later of— 
(A) the due date for filing the tax return for the taxable 
year in which the taxpayer receives such grant, or 
(B) the date which is 1 year after the date of the 
enactment of this Act. 
(3) WAIVER
OF
PENALTIES
AND
INTEREST.—Any under-
payment of tax resulting from the reduction under paragraph 
(1) of the amount otherwise allowable as a deduction shall 
not be subject to any penalty or interest under such Code 
if such tax is paid not later than 1 year after the filing of 
the amended return to which such reduction relates. 
(b) WAIVER OF DEADLINE ON CONSTRUCTION OF GO ZONE PROP-
ERTY ELIGIBLE FOR BONUS DEPRECIATION.— 
(1) IN GENERAL.—Subparagraph (B) of section 1400N(d)(3) 
is amended to read as follows: 
‘‘(B) without regard to ‘and before January 1, 2009’ 
in clause (i) thereof, and’’. 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall apply to property placed in service after December 
31, 2007. 
(c) INCLUSION OF CERTAIN COUNTIES IN GULF OPPORTUNITY 
ZONE FOR PURPOSES OF TAX-EXEMPT BOND FINANCING.— 
(1) IN
GENERAL.—Subsection (a) of section 1400N is 
amended by adding at the end the following new paragraph: 
‘‘(8) INCLUSION OF CERTAIN COUNTIES.—For purposes of this 
subsection, the Gulf Opportunity Zone includes Colbert County, 
Alabama and Dallas County, Alabama.’’. 
Alabama. 
26 USC 1400N 
note. 
Deadline. 
26 USC 168 
note. 
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122 STAT. 2908 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) EFFECTIVE DATE.—The amendment made by this sub-
section shall take effect as if included in the provisions of 
the Gulf Opportunity Zone Act of 2005 to which it relates. 
SEC. 3083. INCREASE IN STATUTORY LIMIT ON THE PUBLIC DEBT. 
Subsection (b) of section 3101 of title 31, United States Code, 
is amended by striking out the dollar limitation contained in such 
subsection and inserting in lieu thereof $10,615,000,000,000. 
Subtitle B—Revenue Offsets 
SEC. 3091. RETURNS RELATING TO PAYMENTS MADE IN SETTLEMENT 
OF PAYMENT CARD AND THIRD PARTY NETWORK TRANS-
ACTIONS. 
(a) IN GENERAL.—Subpart B of part III of subchapter A of 
chapter 61 is amended by adding at the end the following new 
section: 
‘‘SEC. 6050W. RETURNS RELATING TO PAYMENTS MADE IN SETTLE-
MENT OF PAYMENT CARD AND THIRD PARTY NETWORK 
TRANSACTIONS. 
‘‘(a) IN GENERAL.—Each payment settlement entity shall make 
a return for each calendar year setting forth— 
‘‘(1) the name, address, and TIN of each participating payee 
to whom one or more payments in settlement of reportable 
payment transactions are made, and 
‘‘(2) the gross amount of the reportable payment trans-
actions with respect to each such participating payee. 
Such return shall be made at such time and in such form and 
manner as the Secretary may require by regulations. 
‘‘(b) PAYMENT SETTLEMENT ENTITY.—For purposes of this sec-
tion— 
‘‘(1) IN GENERAL.—The term ‘payment settlement entity’ 
means— 
‘‘(A) in the case of a payment card transaction, the 
merchant acquiring entity, and 
‘‘(B) in the case of a third party network transaction, 
the third party settlement organization. 
‘‘(2) MERCHANT ACQUIRING ENTITY.—The term ‘merchant 
acquiring entity’ means the bank or other organization which 
has the contractual obligation to make payment to participating 
payees in settlement of payment card transactions. 
‘‘(3) THIRD PARTY SETTLEMENT ORGANIZATION.—The term 
‘third party settlement organization’ means the central 
organization which has the contractual obligation to make pay-
ment to participating payees of third party network trans-
actions. 
‘‘(4) SPECIAL RULES RELATED TO INTERMEDIARIES.—For pur-
poses of this section— 
‘‘(A) AGGREGATED PAYEES.—In any case where report-
able payment transactions of more than one participating 
payee are settled through an intermediary— 
‘‘(i) such intermediary shall be treated as the 
participating payee for purposes of determining the 
reporting obligations of the payment settlement entity 
with respect to such transactions, and 
26 USC 1400N 
note. 
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122 STAT. 2909 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(ii) such intermediary shall be treated as the pay-
ment settlement entity with respect to the settlement 
of such transactions with the participating payees. 
‘‘(B) ELECTRONIC PAYMENT FACILITATORS.—In any case 
where an electronic payment facilitator or other third party 
makes payments in settlement of reportable payment trans-
actions on behalf of the payment settlement entity, the 
return under subsection (a) shall be made by such electronic 
payment facilitator or other third party in lieu of the pay-
ment settlement entity. 
‘‘(c) REPORTABLE PAYMENT TRANSACTION.—For purposes of this 
section— 
‘‘(1) IN
GENERAL.—The term ‘reportable payment trans-
action’ means any payment card transaction and any third 
party network transaction. 
‘‘(2) PAYMENT CARD TRANSACTION.—The term ‘payment card 
transaction’ means any transaction in which a payment card 
is accepted as payment. 
‘‘(3) THIRD PARTY NETWORK TRANSACTION.—The term ‘third 
party network transaction’ means any transaction which is 
settled through a third party payment network. 
‘‘(d) OTHER DEFINITIONS.—For purposes of this section— 
‘‘(1) PARTICIPATING PAYEE.— 
‘‘(A) IN
GENERAL.—The term ‘participating payee’ 
means— 
‘‘(i) in the case of a payment card transaction, 
any person who accepts a payment card as payment, 
and 
‘‘(ii) in the case of a third party network trans-
action, any person who accepts payment from a third 
party settlement organization in settlement of such 
transaction. 
‘‘(B) EXCLUSION OF FOREIGN PERSONS.—Except as pro-
vided by the Secretary in regulations or other guidance, 
such term shall not include any person with a foreign 
address. 
‘‘(C) INCLUSION OF GOVERNMENTAL UNITS.—The term 
‘person’ includes any governmental unit (and any agency 
or instrumentality thereof). 
‘‘(2) PAYMENT CARD.—The term ‘payment card’ means any 
card which is issued pursuant to an agreement or arrangement 
which provides for— 
‘‘(A) one or more issuers of such cards, 
‘‘(B) a network of persons unrelated to each other, 
and to the issuer, who agree to accept such cards as pay-
ment, and 
‘‘(C) standards and mechanisms for settling the trans-
actions between the merchant acquiring entities and the 
persons who agree to accept such cards as payment. 
The acceptance as payment of any account number or other 
indicia associated with a payment card shall be treated for 
purposes of this section in the same manner as accepting such 
payment card as payment. 
‘‘(3) THIRD
PARTY
PAYMENT
NETWORK.—The term ‘third 
party payment network’ means any agreement or arrange-
ment— 
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122 STAT. 2910 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(A) which involves the establishment of accounts with 
a central organization by a substantial number of persons 
who— 
‘‘(i) are unrelated to such organization, 
‘‘(ii) provide goods or services, and 
‘‘(iii) have agreed to settle transactions for the 
provision of such goods or services pursuant to such 
agreement or arrangement, 
‘‘(B) which provides for standards and mechanisms 
for settling such transactions, and 
‘‘(C) which guarantees persons providing goods or serv-
ices pursuant to such agreement or arrangement that such 
persons will be paid for providing such goods or services. 
Such term shall not include any agreement or arrangement 
which provides for the issuance of payment cards. 
‘‘(e) EXCEPTION FOR DE MINIMIS PAYMENTS BY THIRD PARTY 
SETTLEMENT ORGANIZATIONS.—A third party settlement organiza-
tion shall be required to report any information under subsection 
(a) with respect to third party network transactions of any partici-
pating payee only if— 
‘‘(1) the amount which would otherwise be reported under 
subsection (a)(2) with respect to such transactions exceeds 
$20,000, and 
‘‘(2) the aggregate number of such transactions exceeds 
200. 
‘‘(f) STATEMENTS TO BE FURNISHED TO PERSONS WITH RESPECT 
TO WHOM INFORMATION IS REQUIRED.—Every person required to 
make a return under subsection (a) shall furnish to each person 
with respect to whom such a return is required a written statement 
showing— 
‘‘(1) the name, address, and phone number of the informa-
tion contact of the person required to make such return, and 
‘‘(2) the gross amount of the reportable payment trans-
actions with respect to the person required to be shown on 
the return. 
The written statement required under the preceding sentence shall 
be furnished to the person on or before January 31 of the year 
following the calendar year for which the return under subsection 
(a) was required to be made. Such statement may be furnished 
electronically, and if so, the email address of the person required 
to make such return may be shown in lieu of the phone number. 
‘‘(g) REGULATIONS.—The Secretary may prescribe such regula-
tions or other guidance as may be necessary or appropriate to 
carry out this section, including rules to prevent the reporting 
of the same transaction more than once.’’. 
(b) PENALTY FOR FAILURE TO FILE.— 
(1) RETURN.—Subparagraph (B) of section 6724(d)(1) is 
amended— 
(A) by striking ‘‘or’’ at the end of clause (xx), 
(B) by redesignating the clause (xix) that follows clause 
(xx) as clause (xxi), 
(C) by striking ‘‘and’’ at the end of clause (xxi), as 
redesignated by subparagraph (B) and inserting ‘‘or’’, and 
(D) by adding at the end the following: 
‘‘(xxii) section 6050W (relating to returns to pay-
ments made in settlement of payment card trans-
actions), and’’. 
Email. 
Deadline. 
Records. 
Reports. 
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122 STAT. 2911 
PUBLIC LAW 110–289—JULY 30, 2008 
(2) STATEMENT.—Paragraph (2) of section 6724(d) is 
amended by striking ‘‘or’’ at the end of subparagraph (BB), 
by striking the period at the end of the subparagraph (CC) 
and inserting ‘‘, or’’, and by inserting after subparagraph (CC) 
the following: 
‘‘(DD) section 6050W(c) (relating to returns relating 
to payments made in settlement of payment card trans-
actions).’’. 
(c) APPLICATION OF BACKUP WITHHOLDING.—Paragraph (3) of 
section 3406(b) is amended by striking ‘‘or’’ at the end of subpara-
graph (D), by striking the period at the end of subparagraph (E) 
and inserting ‘‘, or’’, and by adding at the end the following new 
subparagraph: 
‘‘(F) section 6050W (relating to returns relating to pay-
ments made in settlement of payment card transactions).’’. 
(d) CLERICAL AMENDMENT.—The table of sections for subpart 
B of part III of subchapter A of chapter 61 is amended by inserting 
after the item relating to section 6050V the following: 
‘‘Sec. 6050W. Returns relating to payments made in settlement of payment card 
transactions.’’. 
(e) EFFECTIVE DATE.— 
(1) IN GENERAL.—Except as otherwise provided in this sub-
section, the amendments made by this section shall apply to 
returns for calendar years beginning after December 31, 2010. 
(2) APPLICATION OF BACKUP WITHHOLDING.— 
(A) IN GENERAL.—The amendment made by subsection 
(c) shall apply to amounts paid after December 31, 2011. 
(B) ELIGIBILITY FOR TIN MATCHING PROGRAM.—Solely 
for purposes of carrying out any TIN matching program 
established by the Secretary under section 3406(i) of the 
Internal Revenue Code of 1986— 
(i) the amendments made this section shall be 
treated as taking effect on the date of the enactment 
of this Act, and 
(ii) each person responsible for setting the stand-
ards 
and 
mechanisms 
referred 
to 
in 
section 
6050W(d)(2)(C) of such Code, as added by this section, 
for settling transactions involving payment cards shall 
be treated in the same manner as a payment settle-
ment entity. 
SEC. 3092. GAIN FROM SALE OF PRINCIPAL RESIDENCE ALLOCATED 
TO NONQUALIFIED USE NOT EXCLUDED FROM INCOME. 
(a) IN GENERAL.—Subsection (b) of section 121 of the Internal 
Revenue Code of 1986 (relating to limitations) is amended by adding 
at the end the following new paragraph: 
‘‘(4) EXCLUSION
OF
GAIN
ALLOCATED
TO
NONQUALIFIED 
USE.— 
‘‘(A) IN GENERAL.—Subsection (a) shall not apply to 
so much of the gain from the sale or exchange of property 
as is allocated to periods of nonqualified use. 
‘‘(B) GAIN ALLOCATED TO PERIODS OF NONQUALIFIED 
USE.—For purposes of subparagraph (A), gain shall be allo-
cated to periods of nonqualified use based on the ratio 
which— 
26 USC 3406 
note. 
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122 STAT. 2912 
PUBLIC LAW 110–289—JULY 30, 2008 
‘‘(i) the aggregate periods of nonqualified use 
during the period such property was owned by the 
taxpayer, bears to 
‘‘(ii) the period such property was owned by the 
taxpayer. 
‘‘(C) PERIOD OF NONQUALIFIED USE.—For purposes of 
this paragraph— 
‘‘(i) IN GENERAL.—The term ‘period of nonqualified 
use’ means any period (other than the portion of any 
period preceding January 1, 2009) during which the 
property is not used as the principal residence of the 
taxpayer or the taxpayer’s spouse or former spouse. 
‘‘(ii) EXCEPTIONS.—The term ‘period of nonqualified 
use’ does not include— 
‘‘(I) any portion of the 5-year period described 
in subsection (a) which is after the last date that 
such property is used as the principal residence 
of the taxpayer or the taxpayer’s spouse, 
‘‘(II) any period (not to exceed an aggregate 
period of 10 years) during which the taxpayer or 
the taxpayer’s spouse is serving on qualified official 
extended duty (as defined in subsection (d)(9)(C)) 
described in clause (i), (ii), or (iii) of subsection 
(d)(9)(A), and 
‘‘(III) any other period of temporary absence 
(not to exceed an aggregate period of 2 years) 
due to change of employment, health conditions, 
or such other unforeseen circumstances as may 
be specified by the Secretary. 
‘‘(D) COORDINATION WITH RECOGNITION OF GAIN ATTRIB-
UTABLE
TO
DEPRECIATION.—For purposes of this para-
graph— 
‘‘(i) subparagraph (A) shall be applied after the 
application of subsection (d)(6), and 
‘‘(ii) subparagraph (B) shall be applied without 
regard to any gain to which subsection (d)(6) applies.’’. 
(b) EFFECTIVE DATE.—The amendment made by this section 
shall apply to sales and exchanges after December 31, 2008. 
SEC. 3093. DELAY IN APPLICATION OF WORLDWIDE ALLOCATION OF 
INTEREST. 
(a) IN GENERAL.—Paragraphs (5)(D) and (6) of section 864(f) 
are each amended by striking ‘‘December 31, 2008’’ and inserting 
‘‘December 31, 2010’’. 
(b) TRANSITIONAL
RULE.—Subsection (f) of section 864 is 
amended by adding at the end the following new paragraph: 
‘‘(7) TRANSITION.—In the case of the first taxable year 
to which this subsection applies, the increase (if any) in the 
amount of the interest expense allocable to sources within 
the United States by reason of the application of this subsection 
shall be 30 percent of the amount of such increase determined 
without regard to this paragraph.’’. 
(c) EFFECTIVE DATE.—The amendments made by this section 
shall apply to taxable years beginning after December 31, 2008. 
SEC. 3094. TIME FOR PAYMENT OF CORPORATE ESTIMATED TAXES. 
(a) REPEAL OF ADJUSTMENT FOR 2012.—Subparagraph (B) of 
section 401(1) of the Tax Increase Prevention and Reconciliation 
26 USC 864 
note. 
26 USC 121 
note. 
Applicability. 
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122 STAT. 2913 
PUBLIC LAW 110–289—JULY 30, 2008 
LEGISLATIVE HISTORY—H.R. 3221: 
CONGRESSIONAL RECORD: 
Vol. 153 (2007): Aug. 4, considered and passed House. 
Vol. 154 (2008): Apr. 3, 4, 7–10, considered and passed Senate, amended. 
May 8, House concurred in Senate amendment with 
amendments. 
June 19, 20, 23–26, July 7–11, Senate considered and 
concurred in House amendments with an amendment. 
July 23, House concurred in Senate amendment with an 
amendment. 
July 25, 26, Senate considered and concurred in House 
amendment. 
Act of 2005 is amended by striking the percentage contained therein 
and inserting ‘‘100 percent’’. No other provision of law which would 
change such percentage shall have any force and effect. 
(b) MODIFICATION OF ADJUSTMENT FOR 2013.—The percentage 
under subparagraph (C) of section 401(1) of the Tax Increase 
Prevention and Reconciliation Act of 2005 in effect on the date 
of the enactment of this Act is increased by 16.75 percentage 
points. 
Approved July 30, 2008. 
26 USC 6655 
note. 
26 USC 6655 
note. 
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