TEMPORARY LIBERALIZATION OF TAX-EXEMPT HOUSING BOND RULES.

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, determined 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)), or122 STAT. 2893“(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 definitions 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 substituting ‘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 residential 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.