---
kind: "section"
citation: "12 U.S.C. § 1715z–23"
title: "12"
title_heading: "Banks and Banking"
number: "1715z–23"
heading: "HOPE for Homeowners Program"
release: "119-102"
date: "2026-07-12"
url: "https://uscodex.org/usc/12/1715z-23"
units:
  - "Chapter 13 — National Housing"
  - "Subchapter II — Mortgage Insurance"
---

# §1715z–23. 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 Program 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[^1] balance outstanding, and interest rate charged, on their [mortgages](/usc/12/1707.md?p=a);
  - (3) to help stabilize and provide confidence in [mortgage](/usc/12/1707.md?p=a) markets by bringing transparency to the value of assets based on [mortgage](/usc/12/1707.md?p=a) assets;
  - (4) to target [mortgage](/usc/12/1707.md?p=a) 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](/usc/12/1707.md?p=a) with additional methods and approaches to avoid foreclosure.
- (c) **Establishment and implementation of program requirements—**
  - (1) **Duties of Secretary—** In order to carry out the purposes of the HOPE for Homeowners Program, the [Secretary](/usc/12/1715z–22a.md?p=4), after consultation with the [Board](/usc/12/1861.md?p=b-3), shall—
    - (A) establish requirements and standards for the program consistent with [section 1709(b) of this title](/usc/12/1709.md?p=b) to the maximum extent possible; and
    - (B) prescribe such regulations and provide such guidance 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 [paragraph (1)](#c-1), the [Secretary](/usc/12/1715z–22a.md?p=4) may issue such interim guidance and [mortgagee](/usc/12/1707.md?p=b) letters as the [Secretary](/usc/12/1715z–22a.md?p=4) determines necessary or appropriate.
  - (3) **Duties of Board—** The [Board](/usc/12/1861.md?p=b-3) shall advise the [Secretary](/usc/12/1715z–22a.md?p=4) regarding the establishment and implementation of the HOPE for Homeowners Program.
- (d) **Insurance of mortgages—** The [Secretary](/usc/12/1715z–22a.md?p=4) is authorized upon application of a [mortgagee](/usc/12/1707.md?p=b) to make commitments to insure or to insure any eligible [mortgage](/usc/12/1707.md?p=a) that has been refinanced in a manner meeting the requirements under [subsection (e)](#e).
- (e) **Requirements of insured mortgages—** To be eligible for insurance under this section, a refinanced eligible [mortgage](/usc/12/1707.md?p=a) shall comply with all of the following requirements:
  - (1) **Borrower certification—**
    - (A) **No intentional default or false information—** The [mortgagor](/usc/12/1707.md?p=b) shall provide a certification to the [Secretary](/usc/12/1715z–22a.md?p=4) that the [mortgagor](/usc/12/1707.md?p=b) has not intentionally defaulted on the existing [mortgage](/usc/12/1707.md?p=a) or [mortgages](/usc/12/1707.md?p=a) or any other substantial debt within the last 5 years and has not knowingly, or willfully and with actual knowledge, furnished material information known to be false for the purpose of obtaining the eligible [mortgage](/usc/12/1707.md?p=a) to be insured and has not been convicted under Federal or [State](/usc/12/1707.md?p=d) law for fraud during the 10-year period ending upon the insurance of the [mortgage](/usc/12/1707.md?p=a) under this section.
    - (B) **Liability for repayment—** The [mortgagor](/usc/12/1707.md?p=b) shall agree in writing that the [mortgagor](/usc/12/1707.md?p=b) shall be liable to repay to the [Secretary](/usc/12/1715z–22a.md?p=4) any direct financial benefit achieved from the reduction of indebtedness on the existing [mortgage](/usc/12/1707.md?p=a) or [mortgages](/usc/12/1707.md?p=a) on the residence refinanced under this section derived from misrepresentations made by the [mortgagor](/usc/12/1707.md?p=b) in the certifications and documentation required under this paragraph, subject to the discretion of the [Secretary](/usc/12/1715z–22a.md?p=4).
    - (C) **Current borrower debt-to-income ratio—** As of the date of application for a commitment to insure or insurance under this section, the [mortgagor](/usc/12/1707.md?p=b) shall have had, or thereafter is likely to have, due to the terms of the [mortgage](/usc/12/1707.md?p=a) being reset, a ratio of [mortgage](/usc/12/1707.md?p=a) debt to income, taking into consideration all existing [mortgages](/usc/12/1707.md?p=a) of that [mortgagor](/usc/12/1707.md?p=b) at such time, greater than 31 percent (or such higher amount as the [Secretary](/usc/12/1715z–22a.md?p=4) determines appropriate).
  - (2) **Determination of principal obligation amount—** The principal obligation amount of the refinanced eligible [mortgage](/usc/12/1707.md?p=a) to be insured shall—
    - (A) be determined by the reasonable ability of the [mortgagor](/usc/12/1707.md?p=b) to make his or her [mortgage](/usc/12/1707.md?p=a) payments, as such ability is determined by the [Secretary](/usc/12/1715z–22a.md?p=4) pursuant to [section 1709(b)(4) of this title](/usc/12/1709.md?p=b-4) or by any other underwriting standards established by the [Secretary](/usc/12/1715z–22a.md?p=4); and
    - (B) not exceed 90 percent of the appraised value of the property to which such [mortgage](/usc/12/1707.md?p=a) relates (or such higher percentage as the [Secretary](/usc/12/1715z–22a.md?p=4) determines, in the discretion of the [Secretary](/usc/12/1715z–22a.md?p=4)).
  - (3) **Required waiver of prepayment penalties and fees—** All penalties for prepayment or refinancing of the eligible [mortgage](/usc/12/1707.md?p=a), and all fees and penalties related to default or delinquency on the eligible [mortgage](/usc/12/1707.md?p=a), shall be waived or forgiven.
  - (4) **Extinguishment of subordinate liens—**
    - (A) **Required agreement—** All holders of outstanding [mortgage](/usc/12/1707.md?p=a) liens on the property to which the eligible [mortgage](/usc/12/1707.md?p=a) relates shall agree to accept the proceeds of the insured loan and any payments made under this paragraph, as payment in full of all indebtedness under the eligible [mortgage](/usc/12/1707.md?p=a), and all encumbrances related to such eligible [mortgage](/usc/12/1707.md?p=a) shall be removed. The [Secretary](/usc/12/1715z–22a.md?p=4) may take such actions as may be necessary and appropriate to facilitate coordination and agreement between the holders of the existing senior [mortgage](/usc/12/1707.md?p=a) and any existing subordinate [mortgages](/usc/12/1707.md?p=a), taking into consideration the subordinate lien status of such subordinate [mortgages](/usc/12/1707.md?p=a). Such actions may include making payments, which shall be accepted as payment in full of all indebtedness under the eligible [mortgage](/usc/12/1707.md?p=a), to any holder of an existing subordinate [mortgage](/usc/12/1707.md?p=a), in lieu of any future appreciation payments authorized under [subparagraph (B)](#e-4-B).
    - (B) **Shared appreciation—**
      - (i) **In general—** The [Secretary](/usc/12/1715z–22a.md?p=4) may establish standards and policies that will allow for the payment to the holder of any existing subordinate [mortgage](/usc/12/1707.md?p=a) of a portion of any future appreciation in the property secured by such eligible [mortgage](/usc/12/1707.md?p=a) that is owed to the [Secretary](/usc/12/1715z–22a.md?p=4) pursuant to [subsection (k)](#k).
      - (ii) **Factors—** In establishing the standards and policies required under [clause (i)](#e-4-B-i), the [Secretary](/usc/12/1715z–22a.md?p=4) shall take into consideration—
        - (I) the status of any subordinate [mortgage](/usc/12/1707.md?p=a);
        - (II) the outstanding principal balance of and accrued interest on the existing senior [mortgage](/usc/12/1707.md?p=a) and any outstanding subordinate [mortgages](/usc/12/1707.md?p=a);
        - (III) the extent to which the current appraised value of the property securing a subordinate [mortgage](/usc/12/1707.md?p=a) is less than the outstanding principal balance and accrued interest on any other liens that are senior to such subordinate [mortgage](/usc/12/1707.md?p=a); and
        - (IV) such other factors as the [Secretary](/usc/12/1715z–22a.md?p=4) determines to be appropriate.
    - (C) **Voluntary program—** This paragraph may not be construed to require any holder of any existing [mortgage](/usc/12/1707.md?p=a) to participate in the program under this section generally, or with respect to any particular loan.
  - (5) **Term of mortgage—** The refinanced eligible [mortgage](/usc/12/1707.md?p=a) to be insured shall—
    - (A) bear interest at a single rate that is fixed for the entire term of the [mortgage](/usc/12/1707.md?p=a); and
    - (B) have a maturity of not less than 30 years from the date of the beginning of amortization of such refinanced eligible [mortgage](/usc/12/1707.md?p=a).
  - (6) **Maximum loan amount—** The principal obligation amount of the eligible [mortgage](/usc/12/1707.md?p=a) to be insured shall not exceed 132 percent of the dollar amount limitation in effect for 2007 under [section 1454(a)(2) of this title](/usc/12/1454.md?p=a-2) for a property of the applicable size.
  - (7) **Prohibition on second liens—** A [mortgagor](/usc/12/1707.md?p=b) may not grant a new second lien on the mortgaged property during the first 5 years of the term of the [mortgage](/usc/12/1707.md?p=a) insured under this section, except as the [Secretary](/usc/12/1715z–22a.md?p=4) determines to be necessary to ensure the maintenance of property standards.
  - (8) **Appraisals—** Any appraisal conducted in connection with a [mortgage](/usc/12/1707.md?p=a) insured under this section shall—
    - (A) be based on the current value of the property;
    - (B) be conducted in accordance with title XI of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 ([12 U.S.C. 3331](/usc/12/3331.md) et seq.);
    - (C) be completed by an appraiser who meets the competency requirements of the Uniform Standards of Professional Appraisal Practice;
    - (D) be wholly consistent with the appraisal standards, practices, and procedures under [section 1708(e)](/usc/12/1708.md?p=e)[^2] of this title that apply to all loans insured under this chapter; and
    - (E) comply with the requirements of [subsection (g)](#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 [mortgagee](/usc/12/1707.md?p=b) shall document and verify the income of the [mortgagor](/usc/12/1707.md?p=b) or non-filing status in accordance with procedures and standards that the [Secretary](/usc/12/1715z–22a.md?p=4) shall establish (provided that such procedures and standards are consistent with [section 1709(b) of this title](/usc/12/1709.md?p=b) to the maximum extent possible) which may include requiring the [mortgagee](/usc/12/1707.md?p=b) to procure 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.
  - (10) **Mortgage fraud—**
    - (A) **Prohibition—** The [mortgagor](/usc/12/1707.md?p=b) shall not have been convicted under Federal or [State](/usc/12/1707.md?p=d) law for fraud during the 10-year period ending upon the insurance of the [mortgage](/usc/12/1707.md?p=a) under this section.
    - (B) **Duty of mortgagee—** The duty of the [mortgagee](/usc/12/1707.md?p=b) to ensure that the [mortgagor](/usc/12/1707.md?p=b) is in compliance with the prohibition under [subparagraph (A)](#e-10-A) shall be satisfied if the [mortgagee](/usc/12/1707.md?p=b) makes a good faith effort to determine that the [mortgagor](/usc/12/1707.md?p=b) has not been convicted under Federal or [State](/usc/12/1707.md?p=d) law for fraud during the period described in [subparagraph (A)](#e-10-A).
  - (11) **Primary residence—** The [mortgagor](/usc/12/1707.md?p=b) shall provide documentation satisfactory in the determination of the [Secretary](/usc/12/1715z–22a.md?p=4) to prove that the residence covered by the [mortgage](/usc/12/1707.md?p=a) to be insured under this section is occupied by the [mortgagor](/usc/12/1707.md?p=b) as the primary residence of the [mortgagor](/usc/12/1707.md?p=b), and that such residence is the only residence in which the [mortgagor](/usc/12/1707.md?p=b) has any present ownership interest, except that the [Secretary](/usc/12/1715z–22a.md?p=4) may provide exceptions to such latter requirement (relating to present ownership interest) for any [mortgagor](/usc/12/1707.md?p=b) who has inherited a property.
  - (12) **Ban on millionaires—** The [mortgagor](/usc/12/1707.md?p=b) shall not have a net worth, as of the date the [mortgagor](/usc/12/1707.md?p=b) first applies for a [mortgage](/usc/12/1707.md?p=a) to be insured under the Program under this section, that exceeds $1,000,000.
- (f) **Study of auction or bulk refinance program—**
  - (1) **Study—** The [Board](/usc/12/1861.md?p=b-3) shall conduct a study of the need for and efficacy of an auction or bulk refinancing mechanism to facilitate refinancing of existing residential [mortgages](/usc/12/1707.md?p=a) that are at risk for foreclosure into [mortgages](/usc/12/1707.md?p=a) insured under this section. The study shall identify and examine various options for mechanisms under which lenders and servicers of such [mortgages](/usc/12/1707.md?p=a) may make bids for forward commitments for such insurance in an expedited manner.
  - (2) **Content—**
    - (A) **Analysis—** The study required under [paragraph (1)](#f-1) shall analyze—
      - (i) the feasibility of establishing a mechanism that would facilitate the more rapid refinancing of borrowers at risk of foreclosure into performing [mortgages](/usc/12/1707.md?p=a) insured under this section;
      - (ii) whether such a mechanism would provide an effective and efficient mechanism to reduce foreclosures on qualified existing [mortgages](/usc/12/1707.md?p=a);
      - (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;
      - (iv) whether there are other mechanisms or authority that would be useful to reduce foreclosure; and
      - (v) and any other factors that the [Board](/usc/12/1861.md?p=b-3) considers relevant.
    - (B) **Determinations—** To the extent that the [Board](/usc/12/1861.md?p=b-3) finds that a facility of the type described in [subparagraph (A)](#f-2-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 additional 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 July 30, 2008, the [Board](/usc/12/1861.md?p=b-3) 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)](#f-2-A) and of the determinations made pursuant to [paragraph (2)(B)](#f-2-B), and shall include any other findings and recommendations of the [Board](/usc/12/1861.md?p=b-3) pursuant to the study, including identifying various options for mechanisms described in [paragraph (1)](#f-1).
- (g) **Appraisal independence—**
  - (1) **Prohibitions on interested parties in a real estate transaction—** No [mortgage](/usc/12/1707.md?p=a) lender, [mortgage](/usc/12/1707.md?p=a) broker, [mortgage](/usc/12/1707.md?p=a) banker, [real estate](/usc/12/1707.md?p=g) broker, appraisal management company, employee of an appraisal management company, nor any other [person](/usc/12/5481.md?p=19) with an interest in a [real estate](/usc/12/1707.md?p=g) transaction involving an appraisal in connection with a [mortgage](/usc/12/1707.md?p=a) 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](/usc/12/1707.md?p=g) appraisal sought in connection with the [mortgage](/usc/12/1707.md?p=a).
  - (2) **Civil monetary penalties—** The [Secretary](/usc/12/1715z–22a.md?p=4) may impose a civil money penalty for any knowing and material violation of [paragraph (1)](#g-1) under the same terms and conditions as are authorized in [section 1735f–14(a) of this title](/usc/12/1735f–14.md?p=a).
- (h) **Standards to protect against adverse selection—**
  - (1) **In general—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall, by rule or order, establish standards and policies to require the underwriter of the insured loan to provide such representations and warranties as the [Secretary](/usc/12/1715z–22a.md?p=4) considers necessary or appropriate to enforce compliance with all underwriting and appraisal standards of the HOPE for Homeowners Program.
  - (2) **Exclusion for violations—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall not pay insurance benefits to a [mortgagee](/usc/12/1707.md?p=b) who violates the representations and warranties, as established under [paragraph (1)](#h-1), or in any case in which a [mortgagor](/usc/12/1707.md?p=b) fails to make the first payment on a refinanced eligible [mortgage](/usc/12/1707.md?p=a).
  - (3) **Other authority—** The [Secretary](/usc/12/1715z–22a.md?p=4) may establish such other standards or policies as necessary to protect against adverse selection, including requiring loans identified by the [Secretary](/usc/12/1715z–22a.md?p=4) as higher risk loans to demonstrate payment performance for a reasonable period of time prior to being insured under the program.
- (i) **Premiums—**
  - (1) **Premiums—** For each refinanced eligible [mortgage](/usc/12/1707.md?p=a) insured under this section, the [Secretary](/usc/12/1715z–22a.md?p=4) shall establish and collect—
    - (A) at the time of insurance, a single premium payment in an amount not more than 3 percent of the amount of the original insured principal obligation of the refinanced eligible [mortgage](/usc/12/1707.md?p=a), which shall be paid from the proceeds of the [mortgage](/usc/12/1707.md?p=a) being insured under this section, through the reduction of the amount of indebtedness that existed on the eligible [mortgage](/usc/12/1707.md?p=a) prior to refinancing; and
    - (B) in addition to the premium required under [paragraph (1)](#i-1), an annual premium in an amount not more than 1.5 percent of the amount of the remaining insured principal balance of the [mortgage](/usc/12/1707.md?p=a).
  - (2) **Considerations—** In setting the premium under this subsection, the [Secretary](/usc/12/1715z–22a.md?p=4) shall consider—
    - (A) the financial integrity of the HOPE for Homeowners Program; and
    - (B) the purposes of the HOPE for Homeowners Program described in [subsection (b)](#b).
- (j) **Origination fees and interest rate—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall establish—
  - (1) a reasonable limitation on origination fees for refinanced eligible [mortgages](/usc/12/1707.md?p=a) insured under this section; and
  - (2) procedures to ensure that interest rates on such [mortgages](/usc/12/1707.md?p=a) shall be commensurate with market rate interest rates on such types of loans.
- (k) **Exit fee—**
  - (1) **Five-year phase-in for equity as a result of sale or refinancing—** For each eligible [mortgage](/usc/12/1707.md?p=a) insured under this section, the [Secretary](/usc/12/1715z–22a.md?p=4) and the [mortgagor](/usc/12/1707.md?p=b) of such [mortgage](/usc/12/1707.md?p=a) shall, upon any sale or disposition of the property to which such [mortgage](/usc/12/1707.md?p=a) relates, or upon the subsequent refinancing of such [mortgage](/usc/12/1707.md?p=a), be entitled to the following with respect to any equity created as a direct result of the [mortgage](/usc/12/1707.md?p=a) being insured under this section:
    - (A) If such sale or refinancing occurs during the period that begins on the date that such [mortgage](/usc/12/1707.md?p=a) is insured and ends 1 year after such date of insurance, the [Secretary](/usc/12/1715z–22a.md?p=4) 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](/usc/12/1715z–22a.md?p=4) shall be entitled to 90 percent of such equity and the [mortgagor](/usc/12/1707.md?p=b) 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](/usc/12/1715z–22a.md?p=4) shall be entitled to 80 percent of such equity and the [mortgagor](/usc/12/1707.md?p=b) 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 4 years after such date of insurance, the [Secretary](/usc/12/1715z–22a.md?p=4) shall be entitled to 70 percent of such equity and the [mortgagor](/usc/12/1707.md?p=b) 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](/usc/12/1715z–22a.md?p=4) shall be entitled to 60 percent of such equity and the [mortgagor](/usc/12/1707.md?p=b) 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 [Secretary](/usc/12/1715z–22a.md?p=4) shall be entitled to 50 percent of such equity and the [mortgagor](/usc/12/1707.md?p=b) shall be entitled to 50 percent of such equity.
  - (2) **Appreciation in value—** For each eligible [mortgage](/usc/12/1707.md?p=a) insured under this section, the [Secretary](/usc/12/1715z–22a.md?p=4) may, upon any sale or disposition of the property to which the [mortgage](/usc/12/1707.md?p=a) relates, be entitled to up to 50 percent of appreciation, up to the appraised value of the home at the time when the [mortgage](/usc/12/1707.md?p=a) being refinanced under this section was originally made. The [Secretary](/usc/12/1715z–22a.md?p=4) may share any amounts received under this paragraph with or assign the rights of any amounts due to the [Secretary](/usc/12/1715z–22a.md?p=4) to the holder of the existing senior [mortgage](/usc/12/1707.md?p=a) on the eligible [mortgage](/usc/12/1707.md?p=a), the holder of any existing subordinate [mortgage](/usc/12/1707.md?p=a) on the eligible [mortgage](/usc/12/1707.md?p=a), or both.
- (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 [Secretary](/usc/12/1715z–22a.md?p=4) for carrying out the [mortgage](/usc/12/1707.md?p=a) insurance obligations under this section.
  - (2) **Management of Fund—** The HOPE Fund shall be administered and managed by the [Secretary](/usc/12/1715z–22a.md?p=4), who shall establish 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](/usc/12/1707.md?p=a) insured under this section may not exceed $300,000,000,000.
- (n) **Reports by the Secretary—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall submit monthly reports to the Congress identifying the progress of the HOPE for Homeowners Program, which shall contain the following information for each month:
  - (1) The number of new [mortgages](/usc/12/1707.md?p=a) insured under this section, including the location of the properties subject to such [mortgages](/usc/12/1707.md?p=a) by census tract.
  - (2) The aggregate principal obligation of new [mortgages](/usc/12/1707.md?p=a) insured under this section.
  - (3) The average amount by which the principle[^1] balance outstanding on [mortgages](/usc/12/1707.md?p=a) insured this section was reduced.
  - (4) The amount of premiums collected for insurance of [mortgages](/usc/12/1707.md?p=a) under this section.
  - (5) The claim and loss rates for [mortgages](/usc/12/1707.md?p=a) insured under this section.
  - (6) Any other information that the [Secretary](/usc/12/1715z–22a.md?p=4) considers appropriate.
- (o) **Required outreach efforts—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall carry out outreach efforts to ensure that homeowners, lenders, and the general public are aware of the opportunities for assistance available under this section.
- (p) **Enhancement of FHA capacity—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall take such actions as may be necessary to—
  - (1) contract for the establishment of underwriting criteria, automated underwriting systems, pricing standards, and other factors relating to eligibility for [mortgages](/usc/12/1707.md?p=a) insured under this section;
  - (2) contract for independent quality reviews of underwriting, including appraisal reviews and fraud detection, of [mortgages](/usc/12/1707.md?p=a) insured under this section or pools of such [mortgages](/usc/12/1707.md?p=a); and
  - (3) increase personnel of the Department as necessary to process or monitor the processing of [mortgages](/usc/12/1707.md?p=a) insured under this section.
- (q) **GNMA commitment authority—**
  - (1) **Guarantees—** The [Secretary](/usc/12/1715z–22a.md?p=4) shall take such actions as may be necessary to ensure that securities based on and backed by a trust or pool composed of [mortgages](/usc/12/1707.md?p=a) insured under this section are available to be guaranteed by the Government National [Mortgage](/usc/12/1707.md?p=a) Association as to the timely payment of principal and interest.
  - (2) **Guarantee authority—** To carry out the purposes of [section 1721 of this title](/usc/12/1721.md), the Government National [Mortgage](/usc/12/1707.md?p=a) Association may enter into new commitments to issue guarantees of securities based on or backed by [mortgages](/usc/12/1707.md?p=a) 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](/usc/12/1715z–22a.md?p=4) may not enter into any new commitment to insure any refinanced eligible [mortgage](/usc/12/1707.md?p=a), or newly insure any refinanced eligible [mortgage](/usc/12/1707.md?p=a) 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](/usc/12/1707.md?p=b)” means a financial institution or [mortgagee](/usc/12/1707.md?p=b) approved by the [Secretary](/usc/12/1715z–22a.md?p=4) under [section 1709 of this title](/usc/12/1709.md) as responsible and able to service [mortgages](/usc/12/1707.md?p=a) responsibly.
  - (2) **Board—** The term “[Board](/usc/12/1861.md?p=b-3)” means the Advisory [Board](/usc/12/1861.md?p=b-3) for the HOPE for Homeowners Program. The [Board](/usc/12/1861.md?p=b-3) shall be composed of the [Secretary](/usc/12/1715z–22a.md?p=4), the [Secretary](/usc/12/1715z–22a.md?p=4) of the Treasury, the Chairperson of the [Board](/usc/12/1861.md?p=b-3) of Governors of the Federal Reserve System, and the Chairperson of the [Board](/usc/12/1861.md?p=b-3) of [Directors](/usc/12/5481.md?p=10) of the Federal Deposit Insurance Corporation, or their designees.
  - (3) **Eligible mortgage—** The term “eligible [mortgage](/usc/12/1707.md?p=a)” means a [mortgage](/usc/12/1707.md?p=a)—
    - (A) the [mortgagor](/usc/12/1707.md?p=b) of which—
      - (i) occupies such property as his or her principal residence; and
      - (ii) cannot, subject to such standards established by the [Secretary](/usc/12/1715z–22a.md?p=4), afford his or her [mortgage](/usc/12/1707.md?p=a) payments; and
    - (B) originated on or before January 1, 2008.
  - (4) **Existing senior mortgage—** The term “existing senior [mortgage](/usc/12/1707.md?p=a)” means, with respect to a [mortgage](/usc/12/1707.md?p=a) insured under this section, the existing [mortgage](/usc/12/1707.md?p=a) that has superior priority.
  - (5) **Existing subordinate mortgage—** The term “existing subordinate [mortgage](/usc/12/1707.md?p=a)” means, with respect to a [mortgage](/usc/12/1707.md?p=a) insured under this section, an existing [mortgage](/usc/12/1707.md?p=a) that has subordinate priority to the existing senior [mortgage](/usc/12/1707.md?p=a).
  - (6) **HOPE for Homeowners Program—** The term “HOPE for Homeowners Program” means the program established under this section.
  - (7) **Secretary—** The term “[Secretary](/usc/12/1715z–22a.md?p=4)” means the [Secretary](/usc/12/1715z–22a.md?p=4) of Housing and Urban Development, except where specifically provided otherwise.
- (t) **Requirements related to the Board—**
  - (1) **Compensation, actual, necessary, and transportation expenses—**
    - (A) **Federal employees—** A member of the [Board](/usc/12/1861.md?p=b-3) 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](/usc/12/1861.md?p=b-3).
    - (B) **Travel expenses—** Members of the [Board](/usc/12/1861.md?p=b-3) 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.
  - (2) **Bylaws—** The [Board](/usc/12/1861.md?p=b-3) may prescribe, amend, and repeal such bylaws as may be necessary for carrying out the functions of the [Board](/usc/12/1861.md?p=b-3).
  - (3) **Quorum—** A majority of the [Board](/usc/12/1861.md?p=b-3) shall constitute a quorum.
  - (4) **Staff; experts and consultants—**
    - (A) **Detail of Government employees—** Upon request of the [Board](/usc/12/1861.md?p=b-3), any Federal Government employee may be detailed to the [Board](/usc/12/1861.md?p=b-3) without reimbursement, and such detail shall be without interruption or loss of civil service status or privilege.
    - (B) **Experts and consultants—** The [Board](/usc/12/1861.md?p=b-3) shall procure the services of experts and consultants as the [Board](/usc/12/1861.md?p=b-3) 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](/usc/12/1707.md?p=b) participate in any activity authorized under this section, including any activity related to the refinancing of an eligible [mortgage](/usc/12/1707.md?p=a).
- (v) **Rule of construction related to insurance of mortgages—** Except as otherwise provided for in this section or by action of the [Secretary](/usc/12/1715z–22a.md?p=4), the provisions and requirements of [section 1709(b) of this title](/usc/12/1709.md?p=b) shall apply with respect to the insurance of any eligible [mortgage](/usc/12/1707.md?p=a) under this section. The [Secretary](/usc/12/1715z–22a.md?p=4) shall conform documents, forms, and procedures for [mortgages](/usc/12/1707.md?p=a) insured under this section to those in place for [mortgages](/usc/12/1707.md?p=a) insured under [section 1709(b) of this title](/usc/12/1709.md?p=b) to the maximum extent possible consistent with the requirements of this section.
- (w) **HOPE Bonds—**
  - (1) **Issuance and repayment of bonds—** Notwithstanding section 504(b) of the Federal [Credit](/usc/12/5481.md?p=7) Reform Act of 1990 [[2 U.S.C. 661c(b)](/usc/2/661c.md?p=b)], the [Secretary](/usc/12/1715z–22a.md?p=4) of the Treasury shall—
    - (A) subject to such terms and conditions as the [Secretary](/usc/12/1715z–22a.md?p=4) of the Treasury deems necessary, issue Federal [credit](/usc/12/5481.md?p=7) instruments, to be known as “HOPE Bonds”, that are callable at the discretion of the [Secretary](/usc/12/1715z–22a.md?p=4) of the Treasury and do not, in the aggregate, exceed the amount specified in [subsection (m)](#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)](#m), in accordance with the provisions of the Federal [Credit](/usc/12/5481.md?p=7) Reform Act of 1990 ([2 U.S.C. 661](/usc/2/661.md) 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 and payments pursuant to [subsection (e)(4)(A)](#e-4-A).
  - (2) **Reimbursements to Treasury—** Funds received pursuant to [section 4568(b) of this title](/usc/12/4568.md?p=b) shall be used to reimburse the [Secretary](/usc/12/1715z–22a.md?p=4) of the Treasury for amounts borrowed under [paragraph (1)](#w-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)](#w-2), remaining debts of the HOPE for Homeowners Program shall be paid from amounts deposited into the fund established by the [Secretary](/usc/12/1715z–22a.md?p=4) under [section 4567(e) of this title](/usc/12/4567.md?p=e), 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)](#i) and [(k)](#k) in excess of the net cost to the Federal Government for such Program shall be used to reduce the National debt.
- (x) **Payments to servicers and originators—** The [Secretary](/usc/12/1715z–22a.md?p=4) may establish a payment to the—
  - (1) servicer of the existing senior [mortgage](/usc/12/1707.md?p=a) or existing subordinate [mortgage](/usc/12/1707.md?p=a) for every loan insured under the HOPE for Homeowners Program; and
  - (2) originator of each new loan insured under the HOPE for Homeowners Program.
- (y) **Auctions—** The [Secretary](/usc/12/1715z–22a.md?p=4), with the concurrence of the [Board](/usc/12/1861.md?p=b-3), shall, if feasible, establish a structure and organize procedures for an auction to refinance eligible [mortgages](/usc/12/1707.md?p=a) on a wholesale or bulk basis.

## Footnotes

[^1]: So in original. Probably should be “principal”.
[^2]: See References in Text note below.

## Source credit

(June 27, 1934, ch. 847, title II, § 257, as added Pub. L. 110–289, div. A, title IV, § 1402(a), July 30, 2008, 122 Stat. 2800; amended Pub. L. 110–343, div. A, title I, § 124, Oct. 3, 2008, 122 Stat. 3791; Pub. L. 111–22, div. A, title II, § 202(a), May 20, 2009, 123 Stat. 1640.)

## Notes

### Editorial Notes

### References in Text

The Financial Institutions Reform, Recovery, and Enforcement Act of 1989, referred to in subsec. (e)(8)(B), is Pub. L. 101–73, Aug. 9, 1989, 103 Stat. 183. Title XI of the Act is classified principally to chapter 34A (§ 3331 et seq.) of this title. For complete classification of this Act to the Code, see Short Title of 1989 Amendment note set out under section 1811 of this title and Tables.

Section 1708(e) of this title, referred to in subsec. (e)(8)(D), was redesignated section 1708(f) and then 1708(g) of this title by Pub. L. 110–289, div. B, title I, § 2116(1)(B), July 30, 2008, 122 Stat. 2832, and Pub. L. 111–22, div. A, title II, § 203(b)(1), May 20, 2009, 123 Stat. 1643.

The Federal Credit Reform Act of 1990, referred to in subsec. (w)(1)(B), is title V of Pub. L. 93–344, as added by Pub. L. 101–508, title XIII, § 13201(a), Nov. 5, 1990, 104 Stat. 1388–609, which is classified generally to subchapter III (§ 661 et seq.) of chapter 17A of Title 2, The Congress. For complete classification of this Act to the Code, see Short Title note set out under section 621 of Title 2 and Tables.

Section 4568(b) of this title, referred to in subsec. (w)(2), was in the original “section 1338(b) of the Federal Housing Enterprises Regulatory Reform Act of 1992”, and was translated as meaning section 1338(b) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, which is classified to section 4568(b) of this title, to reflect the probable intent of Congress.

### Codification

Pub. L. 111–22, § 202(a)(2), which directed amendment of subsecs. (e), (h)(1), (h)(3), (j), (l), (n), (s)(3), and (v) by substituting “Secretary” for “Board” each place such term appeared, was not executed to subsec. (e)(4)(A), (9), or the heading for subsec. (n), to reflect the probable intent of Congress and the amendments by Pub. L. 111–22, § 202(a)(3)(B)(i), (D)(ii), (7). See 2009 Amendment notes below.

Another section 257 of act June 27, 1934, was renumbered section 258 and is classified to section 1715z–24 of this title.

### Amendments

2009—Subsec. (c)(1). Pub. L. 111–22, § 202(a)(1)(A), (B), substituted “Secretary” for “the Board” in heading and “Secretary, after consultation with the Board,” for “Board” in introductory provisions.

Subsec. (c)(1)(A). Pub. L. 111–22, § 202(a)(1)(C), inserted “consistent with section 1709(b) of this title to the maximum extent possible” before semicolon.

Subsec. (c)(3). Pub. L. 111–22, § 202(a)(1)(D), added par. (3).

Subsec. (e)(1). Pub. L. 111–22, § 202(a)(3)(A), added par. (1) and struck out former par. (1) which related to lack of capacity to pay existing mortgage.

Subsec. (e)(2). Pub. L. 111–22, § 202(a)(2), substituted “established by the Secretary” for “established by the Board” in subpar. (A) and “Secretary” for “Board” in two places in subpar. (B).

Subsec. (e)(4)(A). Pub. L. 111–22, § 202(a)(3)(B)(i), struck out “, subject to standards established by the Board under subparagraph (B),” after “may take such actions”. See Codification note above.

Subsec. (e)(4)(B)(i). Pub. L. 111–22, § 202(a)(3)(B)(ii), substituted “may” for “shall”.

Pub. L. 111–22, § 202(a)(2), substituted “The Secretary” for “The Board”.

Subsec. (e)(4)(B)(ii). Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board” in introductory provisions and in subcl. (IV).

Subsec. (e)(7). Pub. L. 111–22, § 202(a)(3)(C), struck out “; 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 indebtedness, do not exceed 95 percent of the home’s appraised value at the time of the new second lien” after “property standards”.

Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board”.

Subsec. (e)(9). Pub. L. 111–22, § 202(a)(3)(D), substituted “in accordance with procedures and standards that the Secretary shall establish (provided that such procedures and standards are consistent with section 1709(b) of this title to the maximum extent possible) which may include requiring the mortgagee to procure” for “by procuring (A) an income tax return transcript of the income tax returns of the mortgagor, or (B)” and struck out “and by any other method, in accordance with procedures and standards that the Board shall establish” before period at end. See Codification note above.

Subsec. (e)(10). Pub. L. 111–22, § 202(a)(3)(E), designated existing provisions as subpar. (A), inserted subpar. (A) heading, and added subpar. (B).

Subsec. (e)(11). Pub. L. 111–22, § 202(a)(3)(F), inserted “, except that the Secretary may provide exceptions to such latter requirement (relating to present ownership interest) for any mortgagor who has inherited a property” before period at end.

Subsec. (e)(12). Pub. L. 111–22, § 202(a)(3)(G), added par. (12).

Subsec. (h)(1). Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board” in two places.

Subsec. (h)(2). Pub. L. 111–22, § 202(a)(4), substituted “The Secretary shall not pay” for “The Board shall prohibit the Secretary from paying”.

Subsec. (h)(3). Pub. L. 111–22, § 202(a)(2), substituted “The Secretary” for “The Board”.

Subsec. (i). Pub. L. 111–22, § 202(a)(5), designated existing provisions as par. (1) and inserted heading, redesignated former pars. (1) and (2) as subpars. (A) and (B) of par. (1), respectively, and adjusted margins, substituted “not more than 3 percent” for “equal to 3 percent” in par. (1)(A) and “not more than 1.5 percent” for “equal to 1.5 percent” in par. (1)(B), and added par. (2).

Subsec. (j). Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board” in introductory provisions.

Subsec. (k). Pub. L. 111–22, § 202(a)(6)(A), substituted “Exit fee” for “Equity and appreciation” in heading.

Subsec. (k)(1). Pub. L. 111–22, § 202(a)(6)(B), substituted “the mortgage being insured under this section” for “such sale or refinancing” in introductory provisions.

Subsec. (k)(2). Pub. L. 111–22, § 202(a)(6)(C), substituted “may, upon any sale or disposition of the property to which the mortgage relates, be entitled to up to 50 percent of appreciation, up to the appraised value of the home at the time when the mortgage being refinanced under this section was originally made. The Secretary may share any amounts received under this paragraph with or assign the rights of any amounts due to the Secretary to the holder of the existing senior mortgage on the eligible mortgage, the holder of any existing subordinate mortgage on the eligible mortgage, or both.” for “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.”

Subsec. (l)(1). Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board”.

Subsec. (n). Pub. L. 111–22, § 202(a)(2), (7), substituted “Secretary” for “the Board” in heading and “Secretary” for “Board” in introductory provisions and in par. (6). See Codification note above.

Subsec. (p). Pub. L. 111–22, § 202(a)(8), substituted “The” for “Under the direction of the Board, the” in introductory provisions.

Subsec. (s)(2). Pub. L. 111–22, § 202(a)(9)(A), substituted “Advisory Board for” for “Board of Directors of”.

Subsec. (s)(3)(A)(ii). Pub. L. 111–22, § 202(a)(9)(B), substituted “such” for “subsection (e)(1)(B) and such other”.

Pub. L. 111–22, § 202(a)(2), substituted “Secretary” for “Board”.

Subsec. (v). Pub. L. 111–22, § 202(a)(2), (10), substituted “action of the Secretary” for “action of the Board” and inserted at end “The Secretary shall conform documents, forms, and procedures for mortgages insured under this section to those in place for mortgages insured under section 1709(b) of this title to the maximum extent possible consistent with the requirements of this section.”

Subsecs. (x), (y). Pub. L. 111–22, § 202(a)(11), added subsecs. (x) and (y).

2008—Subsec. (e)(1)(B). Pub. L. 110–343, § 124(1)(A), inserted “, or thereafter is likely to have, due to the terms of the mortgage being reset,” before “a ratio”.

Subsec. (e)(2)(B). Pub. L. 110–343, § 124(1)(B), inserted “(or such higher percentage as the Board determines, in the discretion of the Board)” before period at end.

Subsec. (e)(4)(A). Pub. L. 110–343, § 124(1)(C), inserted “and any payments made under this paragraph,” after “insured loan” and inserted “Such actions may include making payments, which shall be accepted as payment in full of all indebtedness under the eligible mortgage, to any holder of an existing subordinate mortgage, in lieu of any future appreciation payments authorized under subparagraph (B).” at end.

Subsec. (w)(1)(C). Pub. L. 110–343, § 124(2), inserted “and payments pursuant to subsection (e)(4)(A)” before period at end.