,,ii  #aac? ,,congress  #b;d ,session   
,s4 #bhed  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,septemb] #ah1         
#bjad,mr4 ,m55dez 7= himself1 ,ms4      
,w>r51 ,mr4 ,re$1 & ,mr4 ,blum5?al7     
introduc$ ! foll[+ bill2 :i* 0 read     
twice & ref]r$ to ! ,committee on       
,bank+1 ,h\s+1 & ,urban ,affairs  ,a    
,,bill  ,to e/abli% pilot programs to   
enc\rage ! use ( %>$ equity mortgage    
modifications1 & = o!r purposes4  #a4   
,%ort title ,?is ,act may be cit$ z !   
,pres]v+ ,am]ican ,home[n]%ip ,act (    
#bjad4  #b4 ,f9d+s ,congress f9ds !     
foll[+3 7#a7 ,high national1 regional1  
or local =eclosure rates de/abilize !   
economy1 h\s+ m>ket1 & neighborhoods ( !
 ,unit$ ,/ates4  7#b7 ,%>$ equity       
mortgage modifications c provide        
alt]natives to =eclosures t b5efit bo?  
und]wat] home[n]s & mortgage inve/ors4  
#c4 ,%>$ equity mortgage modification   
pilot programs  7a7 ,def9itions ,9 ?is  
section-- 7#a7 ! t]m cov]$ mortgage     
means a mortgage-- 7,a7 t is-- 7i7      

pur*as$ by1 gu>ante$ by1 or o!rwise sold
 to ! ,f$]al ,national ,mortgage        
,association1 ! ,gov]nm5t ,national     
,mortgage ,association1 or ! ,f$]al     
,home ,loan ,mortgage ,corporation2 or  
7ii7 insur$ "u title ,,ii ( ! ,national 
,h\s+ ,act 7#ab ,u4,s4,c4 #agjg et      
seq472  7,b7 t is secur$ by real prop]ty
 t is ! prim>y or second>y resid5ce ( a 
home[n]2  7,c7 t is 9 an am\nt t is     
great] ?an ! apprais$ value ( ! real    
prop]ty secur+ ! mortgage on or ab\t !  
date on :i* ! home[n] is approv$ to     
p>ticipate 9 ! pilot program "u         
subsection 7b72  7,d7 ) respect to :i* !
 home[n]-- 7i7 is n few] ?an #fj days   
del9qu5t2 or  7ii7 is at risk ( imm95t  
default2  7,e7 ( a home[n] :o has a     
docum5t$ f9ancial h>d%ip t prev5ts or w 
prev5t ! home[n] f mak+ mortgage        
paym5ts2 &  7,f7 t may1 at ! discretion 
( ! ,director ( ! ,f$]al ,h\s+ ,f9ance  
,ag5cy ) respect to mortgage-back$      
securities or p>ticipation c]tificates  
issu$ by an ent]prise or ( ! ,secret>y (

 ,h\s+ & ,urban ,developm5t ) respect to
 mortgage-back$ securities issu$ by !   
,gov]nm5t ,national ,mortgage           
,association1 respectively1 be made "p (
 any security in/rum5t t may comb9e or  
sep>ate ! mortgage note & equity        
position 9 ! real prop]ty secur+ !      
mortgage2  7#b7 ! t]m equity value ( !  
real prop]ty means ) respect to a cov]$ 
mortgage1 ! diff]5ce betwe5 ! value ( ! 
real prop]ty secur+ ! cov]$ mortgage ^u 
! "t ( sale 7or ref9ance7 & ! initial   
pr9cipal obligation am\nt ow$ on ! cov]$
 mortgage1 less any transaction co/s    
associat$ ) ! sale or ref9anc+1 provid$ 
t if ! equity value is negative at "t ( 
sale 7or ref9ance71 no paym5t is due !  
inve/or2  7#c7 ! t]m ent]prise has !    
same mean+ z 9 section #acjc ( ! ,f$]al 
,h\s+ ,ent]prises ,f9ancial ,safety &   
,s\ndness ,act ( #aiib 7#ab ,u4,s4,c4   
#dejb72  7#d7 ! t]m home[n] means !     
mortgagor "u a cov]$ mortgage2  7#e7 !  
t]m inve/or means-- 7,a7 ! mortgagee "u 
a cov]$ mortgage2 or  7,b7 9 ! case ( a 

cov]$ mortgage t collat]alizes an       
asset-back$ security1 z def9$ 9 section 
#c7;a7 ( ! ,securities ,ex*ange ,act (  
#aicd 7#ae ,u4,s4,c4 #gh;c7a771 ! tru/ee
 = ! asset-back$ security2  7#f7 ! t]m  
pilot program means a pilot program     
e/abli%$ "u subsection 7b72 &  7#g7 !   
t]m %>$ equity mortgage modification    
means a modification ( a cov]$ mortgage 
9 accordance ) subsection 7c74  7b7     
,pilot programs e/abli%$ ,! ,director ( 
! ,f$]al ,h\s+ ,f9ance ,ag5cy & ! ,f$]al
 ,h\s+ ,commission] %all ea* e/abli% a  
pilot program to enc\rage ! use ( %>$   
equity mortgage modifications t are     
design$ to return great] net pres5t     
value to inve/ors ?an o!r               
loss-mitigation activities1 includ+     
=eclosure4  7c7 ,%>$ equity mortgage    
modification ,= purposes ( ! pilot      
program1 a %>$ equity mortgage          
modification %all-- 7#a7 r$uce !        
loan-to-value ratio ( a cov]$ mortgage  
to #ajj p]c5t or less )9 #c ye>s1 by    
r$uc+ ! diff]5ce betwe5 ! initial       

orig9al pr9cipal obligation am\nt ow$ on
 ! cov]$ mortgage & ! r$uc$ pr9cipal    
obligation am\nt det]m9$ by ! t>get$    
loan-to-value ratio set =? 9 ?is        
p>agraph by #a_/c at ! end ( ea* ye> =  
#c ye>s2  7#b7 r$uce ! int]e/ rate = a  
cov]$ mortgage1 if a r$uction ( pr9cipal
 "u p>agraph 7#a7 w\ld n result 9 a     
r$uc$ mon?ly paym5t t is af=dable to !  
home[n]2  7#c7 r$uce ! am\nt ( any      
p]iodic paym5t requir$ to be made by !  
home[n]1 s t ! am\nt payable by !       
home[n] is equal to ! am\nt t w\ld be   
payable by ! home[n] if1 on ! date on   
:i* ! %>$ equity mortgage modification  
takes effect-- 7,a7 all r$uctions ( !   
am\nt ( pr9cipal "u p>agraph 7#a7 _h be5
 made2 &  7,b7 any r$uction 9 ! int]e/  
rate "u p>agraph 7#b7 = :i* ! cov]$     
mortgage is eligible _h be5 made2  7#d7 
require ! home[n] to pay to ! inve/or ^u
 ref9anc+ or sell+ ! real prop]ty secur+
 a cov]$ mortgage1 a p]c5tage 7n to     
exce$ #ej p]c5t7 ( ! equity value ( su* 
real prop]ty1 provid$ t-- 7,a7 ! doll>  

am\nt due to ! inve/or ^u su* sale or   
ref9ance %all n exce$ an am\nt t is     
equal to twice ! l>ge/ doll> am\nt ( !  
pr9cipal r$uction t ! home[n] a*iev$ z a
 result ( ! pr9cipal r$uction "u        
p>agraph 7#a72  7,b7 ! cap e/abli%$ "u  
subp>agraph 7,a7 %all on ,febru>y #a ( !
 ye> foll[+ ! ye> ( enactm5t ( ?is ,act1
 & ea* ,febru>y #a !reaft]1 be adju/$ = 
inflation1 by multiply+ ! prior ye>'s   
cap am\nt by ! ratio ( ! annual av]age (
 ! ,consum] ,price ,index = ,all ,urban 
,consum]s 7,,cpi-,u71 or a              
,,bls-designat$ successor to ,,cpi-,u1 =
 ! prior cal5d> ye> to its annual av]age
 = ! cal5d> ye> two ye>s prior2 &  7,c7 
! inve/or is p]mitt$ to /ructure !      
equity-%>+ int]e/ t ! inve/or is entitl$
 to receive "u ?is p>agraph to be       
transf]rable1 includ+ by /ructur+ su*   
int]e/ = future sale to o!r inve/ors2   
7#e7 be design$ to deliv] maximal net   
pres5t value to ! inve/or1 tak+ into    
acc\nt-- 7,a7 ! pr9cipal r$uction "u    
p>agraph 7#a72  7,b7 any int]e/ rate    

r$uctions "u p>agraph 7#b72  7,c7       
expect$ r$uctions 9 =eclosure & 9 any   
o!r co/s t might r$uce net pres5t value2
 &  7,d7 ! value ( ! equity %>+ int]e/  
det]m9$ "u p>agraph 7#d72 &  7#f7 be    
bas$ on factors includ+ ! p]c5tage value
 ( any pr9cipal r$uction "u p>agraph    
7#a71 ! am\nt ( any su* pr9cipal        
r$uction1 & any o!r factors z det]m9$   
appropriate by ! ,director ( ! ,f$]al   
,h\s+ ,f9ance ,ag5cy or ! ,f$]al ,h\s+  
,commission]1 respectively4  7d7        
,det]m9ation ( value ( home  7#a7 ,9    
g5]al ,= purposes ( ?is section1 ! value
 ( real prop]ty secur+ a cov]$ mortgage 
%all be det]m9$ by a lic5s$ apprais] :o 
is indep5d5t ( & does n o!rwise d       
bus9ess ) ! home[n]1 s]vic]1 inve/or1 or
 an affiliate ( ! home[n]1 s]vic]1 or   
inve/or4  7#b7 ,"t = det]m9ation ,!     
value ( real prop]ty secur+ a cov]$     
mortgage %all be det]m9$ on a date t is 
z close z practicable to ! date on :i* a
 home[n] beg9s to p>ticipate 9 a pilot  
program4  7#c7 ,co/  7,a7               

,responsibility = co/  7i7 ,initial co/ 
,! inve/or %all pay ! co/ ( an appraisal
 "u p>agraph 7#a74  7ii7 ,d$uction f    
home[n] %>e ,at ! option ( ! inve/or1 up
 to "o-half ( ! co/ ( an appraisal "u   
p>agraph 7#a7 may be add$ to ! am\nt    
paid by ! home[n] to ! inve/or "u       
subsection 7c77#d74  7,b7 ,reasonabl5ess
 ( co/ ,! co/ ( an appraisal "u p>agraph
 7#a7 %all be reasonable1 z det]m9$ by !
 ,director ( ! ,f$]al ,h\s+ ,f9ance     
,ag5cy or ! ,f$]al ,h\s+ ,commission]1  
respectively4  7#d7 ,second appraisal   
,at ! "t ( ref9anc+ or sale ( real      
prop]ty secur+ a cov]$ mortgage1 !      
inve/or may reque/ a second appraisal ( 
! value ( ! real prop]ty1 at ! exp5se ( 
! inve/or1 by a lic5s$ apprais] select$ 
by ! ,director ( ! ,f$]al ,h\s+ ,f9ance 
,ag5cy or ! ,f$]al ,h\s+ ,commission]1  
respectively1 :o is indep5d5t ( & does n
 o!rwise d bus9ess ) ! home[n]1 s]vic]1 
inve/or1 or an affiliate ( ! home[n]1   
s]vic]1 or inve/or1 if ! inve/or        
believes t ! sale price or claim$ value 

at ! "t ( ! ref9anc+ is n an accurate   
reflection ( ! fair m>ket value ( ! real
 prop]ty4  7e7 ,eligibility = r$uction (
 pr9cipal ,ea* pilot program %all       
provide t a home[n] is n eligible = a   
r$uction 9 ! am\nt ( pr9cipal "u a cov]$
 mortgage "u a %>$ equity mortgage      
modification if1 aft] ! home[n] beg9s   
p>ticipat+ 9 ! pilot program1 !         
home[n]-- 7#a7 is del9qu5t on m ?an #c  
paym5ts "u ! %>$ equity mortgage        
modification dur+ any ( ! #c successive 
#a-ye> p]iods beg9n+ on ! date on :i* ! 
%>$ equity mortgage modification is     
made2 &  7#b7 fails to be curr5t ) all  
paym5ts describ$ 9 p>agraph 7#a7 be=e ! 
end ( ea* #a-ye> p]iod describ$ 9       
p>agraph 7#a74  7f7 ,p>ticipation by    
s]vic]s ,! ,director ( ! ,f$]al ,h\s+   
,f9ance ,ag5cy %all require ea*         
ent]prise to require t any s]vic] ( a   
cov]$ mortgage 9 :i* ! ent]prise is an  
inve/or p>ticipate 9 ! pilot program ( !
 ,f$]al ,h\s+ ,f9ance ,ag5cy by (f]+ %>$
 equity mortgage modifications to a r&om

 & /ati/ically significant sampl+ (     
home[n]s ) cov]$ mortgages4  7g7 ,/udies
 & reports ,! ,director ( ! ,f$]al ,h\s+
 ,f9ance ,ag5cy & ! ,f$]al ,h\s+        
,commission] %all-- 7#a7 conduct annual 
/udies ( ! pilot program ( ! ,f$]al     
,h\s+ ,f9ance ,ag5cy & ! ,f$]al ,h\s+   
,adm9i/ration1 respectively2  7#b7      
submit a report to ,congress conta9+ !  
results ( ea* /udy at ! end ( ea* ( ! #c
 successive #a-ye> p]iods beg9n+ on !   
date on :i* ! pilot program is e/abli%$2
 &  7#c7 make publicly available to !   
maximum ext5t possible1 consi/5t ) !    
protection ( any p]sonal in=mation1 & 9 
a timely mann] any data g5]at$ by !     
pilot program4