CHANGES TO HOPE FOR HOMEOWNERS PROGRAM.

SEC. 202. CHANGES TO HOPE FOR HOMEOWNERS PROGRAM.(a) Program Changes.—Section 257 of the National Housing Act (12 U.S.C. 1715z–23) is amended—(1) in subsection (c)—(A) in the heading for paragraph (1), by striking “the board” and inserting “secretary”;(B) in paragraph (1), by striking “Board” inserting “Secretary, after consultation with the Board,”;(C) in paragraph (1)(A), by inserting “consistent with section 203(b) to the maximum extent possible” before the semicolon; and(D) by adding after paragraph (2) the following:“(3) Duties of board.—The Board shall advise the Secretary regarding the establishment and implementation of the HOPE for Homeowners Program.”;(2) by striking “Board” each place such term appears in subsections (e), (h)(1), (h)(3), (j), (l), (n), (s)(3), and (v) and inserting “Secretary”;(3) in subsection (e)—(A) by striking paragraph (1) and inserting the following:“(1) Borrower certification.—“(A) No intentional default or false information.—The mortgagor shall provide a certification to the Secretary that the mortgagor has not intentionally defaulted on the existing mortgage or mortgages 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 to be insured and has not been convicted under Federal or State law for fraud during the 10-year period ending upon the insurance of the mortgage under this section.“(B) Liability for repayment.—The mortgagor shall agree in writing that the mortgagor shall be liable to repay to the Secretary any direct financial benefit achieved from the reduction of indebtedness on the existing mortgage or mortgages on the residence refinanced under this section derived from misrepresentations made by the mortgagor in the certifications and documentation required under this paragraph, subject to the discretion of the Secretary.“(C) Current borrower debt-to-income ratio.—As of the date of application for a commitment to insure or 123 STAT. 1641 insurance under this section, the mortgagor shall have had, or thereafter is likely to have, due to the terms of the mortgage being reset, 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 Secretary determines appropriate).”;(B) in paragraph (4)—(i) in subparagraph (A), by striking “, subject to standards established by the Board under subparagraph (B),”; and(ii) in subparagraph (B)(i), by striking “shall” and inserting “may”; and(C) in paragraph (7), by striking “; and provided that” and all that follows through “new second lien”;(D) in paragraph (9)—(i) by striking “by procuring (A) an income tax return transcript of the income tax return of the mortgagor, or (B)” and inserting “in accordance with procedures and standards that the Secretary shall establish (provided that such procedures and standards are consistent with section 203(b) to the maximum extent possible) which may include requiring the mortgagee to procure”; and(ii) by striking “and by any other method, in accordance with procedures and standards that the Board shall establish”;(E) in paragraph (10)—(i) by striking “The mortgagor shall not” and inserting the following:“(A) Prohibition.—The mortgagor shall not”; and(ii) by adding at the end the following:“(B) Duty of mortgagee.—The duty of the mortgagee to ensure that the mortgagor is in compliance with the prohibition under subparagraph (A) shall be satisfied if the mortgagee makes a good faith effort to determine that the mortgagor has not been convicted under Federal or State law for fraud during the period described in subparagraph (A).”;(F) in paragraph (11), by inserting before the period at the end the following: “, except that the Secretary may provide exceptions to such latter requirement (relating to present ownership interest) for any mortgagor who has inherited a property”; and(G) by adding at the end:“(12) Ban on millionaires.—The mortgagor shall not have a net worth, as of the date the mortgagor first applies for a mortgage to be insured under the Program under this section, that exceeds $1,000,000.”;(4) in subsection (h)(2), by striking “The Board shall prohibit the Secretary from paying” and inserting “The Secretary shall not pay”; and(5) in subsection (i)—(A) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively, and adjusting the margins accordingly;123 STAT. 1642(B) in the matter preceding subparagraph (A), as redesignated by this paragraph, by striking “For each” and inserting the following:“(1) Premiums.—For each”;(C) in subparagraph (A), as redesignated by this paragraph, by striking “equal to 3 percent” and inserting “not more than 3 percent”; and(D) in subparagraph (B), as redesignated by this paragraph, by striking “equal to 1.5 percent” and inserting “not more than 1.5 percent”;(E) by adding at the end the following:“(2) Considerations.—In setting the premium under this subsection, the Secretary 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).”;(6) in subsection (k)—(A) by striking the subsection heading and inserting “Exit Fee”;(B) in paragraph (1), in the matter preceding subparagraph (A), by striking “such sale or refinancing” and inserting “the mortgage being insured under this section”; and(C) in paragraph (2), by striking “and the mortgagor” and all that follows through the end and inserting “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.”;(7) in the heading for subsection (n), by striking “the Board” and inserting “Secretary”;(8) in subsection (p), by striking “Under the direction of the Board, the” and inserting “The”;(9) in subsection (s)—(A) in the first sentence of paragraph (2), by striking “Board of Directors of” and inserting “Advisory Board for”; and(B) in paragraph (3)(A)(ii), by striking “subsection (e)(1)(B) and such other” and inserting “such”;(10) in subsection (v), by inserting after the period at the end the following: “The Secretary shall conform documents, forms, and procedures for mortgages insured under this section to those in place for mortgages insured under section 203(b) to the maximum extent possible consistent with the requirements of this section.”; and(11) by adding at the end the following new subsections:“(x) Payments to Servicers and Originators.—The Secretary may establish a payment to the—123 STAT. 1643“(1) servicer of the existing senior mortgage or existing subordinate mortgage 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, with the concurrence of the Board, shall, if feasible, establish a structure and organize procedures for an auction to refinance eligible mortgages on a wholesale or bulk basis.”.(b) Reducing TARP Funds To Offset Costs of Program Changes.—Paragraph (3) of section 115(a) of the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5225) is amended by inserting “, as such amount is reduced by $1,244,000,000,” after “$700,000,000,000”.(c) Technical Correction.—The second section 257 of the National Housing Act (Public Law 110–289; 122 Stat. 2839; 12 U.S.C. 1715z–24) is amended by striking the section heading and inserting the following:“SEC. 258. PILOT PROGRAM FOR AUTOMATED PROCESS FOR BORROWERS WITHOUT SUFFICIENT CREDIT HISTORY.” .