Housing Finance Reform and Taxpayer Protection Act of 2013
A BILL
To provide secondary mortgage market reform, and for other purposes.
Sec. 2 Definitions
As used in this Act, the following definitions shall apply:
Approved bond guarantor— The term “approved bond guarantor” means any entity that provides credit enhancement that is approved by the Corporation pursuant to section 214 to guarantee the timely payment of principal and interest on securities collateralized by eligible mortgages and insured by the Corporation.
Approved issuer— The term “approved issuer” means an issuer that is approved by the Corporation pursuant to section 213—
to issue covered securities; and
to purchase insurance offered by the Corporation pursuant to title II on a covered security for which first loss credit enhancement has been secured.
Approved private mortgage insurer— The term “approved private mortgage insurer” means an insurer that is approved by the Corporation pursuant to section 211 to provide private mortgage insurance on eligible mortgages.
Approved servicer— The term “approved servicer” means a servicer that is approved by the Corporation pursuant to section 212 to administer eligible mortgages.
Area— The term “area”—
means a metropolitan statistical area as established by the Office of Management and Budget; and
for purposes of paragraph (11)(A)(ii), the median 1-family house price for an area shall be equal to the median 1-family house price of the county within the area that has the highest such median price.
Board; Board of Directors— The terms “Board” and “Board of Directors” mean the Board of Directors of the Federal Mortgage Insurance Corporation.
Charter— The term charter means—
with respect to the Federal National Mortgage Association, the Federal National Mortgage Association Charter Act (12 U.S.C. 1716 et seq.); and
with respect to the Federal Home Loan Mortgage Corporation, the Federal Home Loan Mortgage Corporation Act (12 U.S.C. 1451 et seq.).
Corporation— The term “Corporation” means the Federal Mortgage Insurance Corporation established under title I.
Covered security— The term covered security means a mortgage-backed security—
collateralized by eligible mortgages;
which is issued subject to a standard form credit-risk sharing mechanism, product, structure, contract, or other securitization agreement developed by the Corporation pursuant to title II; and
which is eligible for insurance by the Corporation pursuant to title II, which insurance is purchased by an approved issuer who issues covered securities.
Director— The term “Director” means the Director of the Federal Mortgage Insurance Corporation, unless the context otherwise requires.
Eligible mortgage— The term eligible mortgage means a mortgage—
that is a residential real estate loan secured by a property with 1 to 4 single family units that has been originated in compliance with the provisions of section 1026 of title 12 of the Code of Federal Regulations, as promulgated by the Bureau of Consumer Financial Protection pursuant to section 129C(b) of the Truth in Lending Act (15 U.S.C. 1639c(b)) (commonly referred to as the “Ability-to-Repay and Qualified Mortgage Rule”);
has a maximum original principal obligation amount that does not exceed the conforming loan limitation determined under section 504;
the outstanding principal balance of which at the time of purchase of insurance available under title II—
is less than 80 percent of the value of the property securing the mortgage;
is not less than 80 percent but not more than 85 percent of the value of the property securing the mortgage, provided that not less than 12 percent of the unpaid principal balance of the mortgage, accounting for any downpayment required under subparagraph (D), is insured by—
an approved private mortgage insurer; or
lender recourse or other credit enhancement that—
meets standards comparable to the standards required of private mortgage insurers under section 211; and
is approved by the Corporation;
is not less than 85 percent but not more than 90 percent of the value of the property securing the mortgage, provided that not less than 25 percent of the unpaid principal balance of the mortgage, accounting for any downpayment required under subparagraph (D), is insured by—
an approved private mortgage insurer; or
lender recourse or other credit enhancement that—
meets standards comparable to the standards required of private mortgage insurers under section 211; and
is approved by the Corporation; or
is not less than 90 percent but not more than 95 percent of the value of the property securing the mortgage, provided that not less than 30 percent of the unpaid principal balance of the mortgage, accounting for any downpayment required under subparagraph (D), is insured by—
an approved private mortgage insurer; or
lender recourse or other credit enhancement that—
meets standards comparable to the standards required of private mortgage insurers under section 211; and
is approved by the Corporation;
having a downpayment which shall be equal to not less than 5 percent of purchase price of the property securing the mortgage;
that is insured by an approved State licensed title insurance company;
that contains such terms and provisions with respect to insurance, property maintenance, repairs, alterations, payment of taxes, default, reserves, delinquency charges, foreclosure proceedings, anticipation of maturity, additional and secondary liens, and other matters, including matters that set forth terms and provisions for establishing escrow accounts, performing financial assessments, or limiting the amount of any payment made available under the mortgage as the Corporation may prescribe; and
that contains such other terms or characteristics as the Corporation, in consultation with the Bureau of Consumer Financial Protection, may determine necessary or appropriate.
Enterprise— The term enterprise means—
the Federal National Mortgage Association and any affiliate thereof; and
the Federal Home Loan Mortgage Corporation and any affiliate thereof.
Federal banking agencies— The term—
“Federal banking agency” means, individually, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Bureau of Consumer Financial Protection, the National Credit Union Administration, the Securities and Exchange Commission, the Commodities Futures Trading Commission, the Federal Housing Finance Agency, and the Secretary of the Treasury; and
“Federal banking agencies” means all of the agencies referred to in subparagraph (A), collectively.
Federal Home Loan Bank— The term Federal Home Loan Bank means a bank established under the authority of the Federal Home Loan Bank Act (12 U.S.C. 1421 et seq.).
Federal Home Loan Bank System— The term Federal Home Loan Bank System means the Federal Home Loan Banks and the Office of Finance and any authorized subsidiary of one or more Federal Home Loan Banks.
FMIC certification date— The term “FMIC certification date” means the date on which the Board of Directors certifies that the Corporation is operational and able to perform the insurance functions for covered securities as provided in this Act, which date shall be not later than 5 years after the date of enactment of this Act.
Insured depository institution— The term “insured depository institution” means—
an insured depository institution, as defined under section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813); and
a credit union that meets the definition of “depository institution” as that term is defined under section 19(b) of the Federal Reserve Act (12 U.S.C. 461).
Senior Preferred Stock Purchase Agreement defined— The term Senior Preferred Stock Purchase Agreement means—
the Amended and Restated Senior Preferred Stock Purchase Agreement, dated September 26, 2008, as such Agreement has been amended on May 6, 2009, December 24, 2009, and August 17, 2012, respectively, and as such Agreement may be further amended and restated, entered into between the Department of the Treasury and each enterprise, as applicable; and
any provision of any certificate in connection with such Agreement creating or designating the terms, powers, preferences, privileges, limitations, or any other conditions of the Variable Liquidation Preference Senior Preferred Stock of an enterprise issued or sold pursuant to such Agreement.
Transfer date— The term “transfer date” means the date that is 1 year after the date of enactment of this Act.