,i #aaeth ,,congress #ast ,session ,h4 ,r4 #cacd ,,in ,,the ,,house ,,of ,,representatives ,june #bi1 #bjag,ms4 ,kaptur 7for herself1 ,mr4 ,clay1 ,mr4 ,evans1 ,mr4 ,brady of ,pennsylvania1 ,ms4 ,fudge1 ,ms4 ,jayapal1 and ,ms4 ,pingree7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,a ,,bill ,to direct the ,secretary of the ,department of ,housing and ,urban ,development and the ,director of the ,federal ,housing ,finance ,agency to develop a program to provide assistance to creditworthy borrowers with ,federal student debt in purchasing certain foreclosed homes4 #a4 ,short title ,this ,act may be cited as the ,transforming ,student ,debt to ,home ,equity ,act of #bjag4 #b4 ,findings ,congress finds the following3 7#a7 ,in the fourth quarter of #bjaf1 over #ag1bjj1jjj homes remain vacant in the ,united ,states4 7#b7 ,these extended vacancies depress neighborhood property values and create a downward spiral in neighborhood stability in already troubled communities4 7#c7 ,meanwhile1 due to climbing expenses of higher education1 the total ,federal student debt owed equals #a1cjj1jjj1jjj4 7#d7 ,more than #dj1jjj1jjj ,americans have at least one outstanding student loan1 up dramatically from #bi1jjj1jjj ,americans just #aj years ago4 7#e7 ,student loan repayments are forcing millions of young families out of purchasing their first home1 as they cannot afford to save for a down payment or qualify for a mortgage4 7#f7 ,it is imperative to find a way to systematically convert debt streams into equity streams1 otherwise housing purchases will continue to be sluggish and thousands more ,americans will retire saddled with student loan debt never having had the opportunity to accumulate equity4 7#g7 ,it is in the interest of the ,federal ,government to use the resources at its disposal1 including both housing properties held in trust and student debt obligations1 to put reverse pressure on these downward trends4 7#h7 ,by arranging financing that recalculates terms1 debt-to-income ratios1 mortgage interest rates1 and other factors1 short-term student debt could transition into longer term home ownership4 7#i7 ,the goal is to connect creditworthy ,federal student debt holders with housing properties for sale but held by the ,federal ,government4 7#aj7 ,eventually1 participants can help restore neighborhoods1 transform their debt to equity1 and buy property values locally and on the ,federal ledger simply by maintaining and investing in a home mortgage4 #c4 ,program to expand access to mortgages to eligible creditworthy homebuyers with ,federal student loan debt 7a7 ,establishment ,from amounts appropriated pursuant to subsection 7g71 the ,secretary of the ,department of ,housing and ,urban ,development and the ,director of the ,federal ,housing ,finance ,agency shall jointly establish and carry out a pilot demonstration program to provide assistance to eligible applicants in purchasing eligible properties4 7b7 ,eligible applicants ,to be eligible for the program established in this ,act1 an applicant-- 7#a7 shall have an outstanding balance of principal or interest owing on a loan made1 insured1 or guaranteed under title ,,iv of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajgj et seq472 7#b7 may not be subject to a judgment secured through litigation with respect to such a loan under title ,,iv of the ,higher ,education ,act of #aife 7#bj ,u4,s4,c4 #ajgj et seq471 may not be subject to an order for wage garnishment under section #dhh;,a of such ,act 7#bj ,u4,s4,c4 #ajie;a71 and at the time of application for participation in the program under this section-- 7,a7 such a loan shall be in repayment status as determined under section #dbh7;b77#g77;,a7 of such ,act 7#bj ,u4,s4,c4 #ajgh7;b77#g77;,a772 or 7,b7 such a loan shall be in a grace period preceding repayment2 7#c7 may not have owned a home during the #c-year period immediately before the applicant purchases an eligible property with assistance provided under this ,act2 7#d7 shall complete a program of counseling with respect to the responsibilities and financial management involved in homeownership that is approved by the ,secretary2 7#e7 shall be creditworthy1 as determined by the ,secretary and the ,director2 7#f7 shall agree to use an eligible property purchased with assistance provided under this ,act as the applicant's primary residence for not less than the #c-year period beginning on the date of such purchase2 and 7#g7 shall be employed and earning sufficient income to repay a mortgage loan1 as determined by the ,secretary and the ,director for the purposes of this program4 7c7 ,types of assistance 7#a7 ,in general ,a program established under this ,act may provide for any one or more of the following options3 7,a7 ,a discount on the appraised value of an eligible property4 7,b7 ,flexibility in underwriting standards related to the purchase of eligible properties for mortgages insured under title ,,ii of the ,national ,housing ,act 7#ab ,u4,s4,c4 #agjg et seq47 or owned or guaranteed by the ,federal ,national ,mortgage ,association or the ,federal ,home ,loan ,mortgage ,corporation4 7,c7 ,the development of new mortgage products specifically targeted to eligible applicants4 7,d7 ,in coordination with the ,department of the ,treasury and the ,department of ,education1 the development of a program that will use actuarial information to determine how the repayment of loans described in subsection 7b77#a7 may be integrated into a mortgage repayment schedule to allow an eligible applicant to accumulate equity in the eligible property1 including by reason of meeting the eligible applicant's obligations under such student loan4 7,e7 ,any other assistance that the ,secretary and ,director jointly deem appropriate4 7#b7 ,collaboration ,in providing assistance described under paragraph 7#a71 the ,secretary and the ,director may collaborate with community banks having less than #aj1jjj1jjj1jjj in total assets1 credit unions 7as defined in section #aja of the ,federal ,credit ,union ,act71 and local fair housing organizations4 7d7 ,geographical diversity ,in selecting eligible applicants to receive assistance under this ,act1 the ,secretary and the ,director shall1 to the extent practicable1 consider the location of the eligible property to be purchased by the eligible applicant1 including whether the eligible property is located in a rural or urban area1 to ensure geographic diversity of such eligible properties4 7e7 ,reports 7#a7 ,interim report ,not later than #ij days after the date of the enactment of this ,act1 the ,secretary and the ,director shall submit to ,congress an interim report describing the type of assistance the ,secretary and the ,director shall provide under the program established under this ,act4 7#b7 ,final report ,not later than #c years after the date of the enactment of this ,act1 the ,secretary and the ,director shall submit to ,congress a final report evaluating the impact of the program carried out under this ,act and describing other types of assistance the ,secretary and the ,director may offer4 7f7 ,definitions ,in this ,act3 7#a7 ,director ,the term ,director means the ,director of the ,federal ,housing ,finance ,agency4 7#b7 ,secretary ,the term ,secretary means the ,secretary of the ,department of ,housing and ,urban ,development4 7#c7 ,eligible property ,the term eligible property means a property that is designed as a dwelling for occupancy by #a to #d families-- 7,a7 that is safe and habitable1 as defined by the ,secretary and the ,director2 7,b7 for which1 as determined by the ,secretary and the ,director1 the occupancy of which will promote community revitalization2 and 7,c7 that-- 7i7 was previously subject to a mortgage loan insured by the ,federal ,housing ,administration under title ,,ii of the ,national ,housing ,act 7#ab ,u4,s4,c4 #agjg et seq47 and is owned by the ,secretary pursuant to the payment of insurance benefits under such ,act2 or 7ii7 is a real estate owned property of the ,federal ,national ,mortgage ,association or the ,federal ,home ,loan ,mortgage ,corporation4 7g7 ,authorization of appropriations ,there are authorized to be appropriated such sums as necessary to carry out this ,act for fiscal years #bjah to #bjbj4