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.^[1]—

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 regulated 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 Agency 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.

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 regulated 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 assets.

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.

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 establish a loan originator licensing system.

Sec. 1509. Backup authority to establish a nationwide mortgage licensing and registry 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 payment 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.

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 foreclosed 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 institutions.

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.

Sec. 2602. Eligibility for specially adapted housing benefits and assistance for members of the Armed Forces with service-connected disabilities and individuals residing outside the United States.

Sec. 2603. Specially adapted housing assistance for individuals with severe burn injuries.

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 reside 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 agencies.

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.

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 located in disaster areas.

Sec. 3027. Transfer of funds appropriated to carry out 2008 recovery rebates for individuals.

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 depreciation.

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.

Approved July 30, 2008.

Notes

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 amendment.
  • July 23, House concurred in Senate amendment with amendment.
  • July 25, 26, Senate considered and concurred in House amendment.