,,ib ,union ,calendar ,no4 #djb #aaeth ,,congress #b;d ,session ,h4 ,r4 #cbii ,report ,no4 #aae-ech ,,in ,,the ,,house ,,of ,,representatives ,july #ai1 #bjag ,mr4 ,mc,henry 7for himself and ,mr4 ,meeks7 introduced the following bill2 which was referred to the ,committee on ,financial ,services ,january #cj1 #bjah;,additional sponsors3 ,ms4 ,moore and ,mr4 ,hollingsworth ,january #cj1 #bjah ,committed to the ,committee of the ,whole ,house on the ,state of the ,union and ordered to be printed ,a ,,bill ,to amend the ,revised ,statutes1 the ,home ,owners' ,loan ,act1 the ,federal ,credit ,union ,act1 and the ,federal ,deposit ,insurance ,act to require the rate of interest on certain loans remain unchanged after transfer of the loan1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,protecting ,consumers' ,access to ,credit ,act of #bjag4 #b4 ,findings ,congress finds that-- 7#a7 the contractual doctrine of valid when made which1 as applied to lending agreements1 provides that a loan that is valid at inception cannot become usurious upon subsequent sale or transfer to another person2 7#b7 this important and longstanding principle derives from the common law and its application has been a cornerstone of ,united ,states banking law for nearly #bjj years1 as provided in the case ,nichols v4 ,fearson1 #cb ,u4,s4 7#g ,pet47 #ajc1 #ajf 7#ahcc71 where the ,supreme ,court famously declared3 ,yet the rule of law is everywhere acknowledged1 that a contract free from usury in its inception1 shall not be invalidated by any subsequent usurious transactions upon it42 7#c7 in #bjaf1 the ,solicitor ,general1 in consultation with all ,federal banking regulators1 filed an amicus brief in the case of ,midland ,funding1 ,,llc v4 ,madden1 #acf ,s4 ,ct4 #beje 7#bjaf7 7mem471 denying cert4 to #ghf ,f4#c;d #bdf 7#b;d ,cir4 #bjae71 that described the ,united ,states ,court of ,appeals for the ,second ,circuit in that case incorrect with an analysis reflecting a misunderstanding of section #he of the ,national ,bank ,act and ,supreme ,court precedent1 because it contradicted the contractual doctrine of valid when made2 7#d7 the valid-when-made doctrine1 by bringing certainty to the legal treatment of all valid loans that are transferred1 greatly enhances liquidity in the credit markets by widening the potential pool of loan buyers and reducing the cost of credit to borrowers at the time of origination2 7#e7 a joint academic study from professors at ,stanford1 ,fordham1 and ,columbia universities concluded that the ,madden v4 ,midland decision has already disproportionately affected low- and moderate-income individuals in the ,united ,states with lower ,,fico scores2 and 7#f7 if the valid-when-made doctrine is not reaffirmed soon by ,congress1 the lack of access to safe and affordable financial services will force households in the ,united ,states with the fewest resources to seek financial products that are nontransparent1 fail to inform consumers about the terms of credit available1 and do not comply with ,state and ,federal laws 7including regulations74 #c4 ,rate of interest after transfer of loan 7a7 ,amendment to the ,revised ,statutes ,section #eaig of the ,revised ,statutes 7#ab ,u4,s4,c4 #he7 is amended by adding at the end the following3 ,a loan that is valid when made as to its maximum rate of interest in accordance with this section shall remain valid with respect to such rate regardless of whether the loan is subsequently sold1 assigned1 or otherwise transferred to a third party1 and may be enforced by such third party notwithstanding any ,state law to the contrary44 7b7 ,amendment to the ,home ,owners' ,loan ,act ,section #d7;g7 of the ,home ,owners' ,loan ,act 7#ab ,u4,s4,c4 #adfc7;g77 is amended by adding at the end the following3 7#c7 ,a loan that is valid when made as to its maximum rate of interest in accordance with this subsection shall remain valid with respect to such rate regardless of whether the loan is subsequently sold1 assigned1 or otherwise transferred to a third party1 and may be enforced by such third party notwithstanding any ,state law to the contrary4 4 7c7 ,amendment to the ,federal ,credit ,union ,act ,section #bje7;g7 of the ,federal ,credit ,union ,act 7#ab ,u4,s4,c4 #aghe7;g77 is amended by adding at the end the following3 7#c7 ,a loan that is valid when made as to its maximum rate of interest in accordance with this subsection shall remain valid with respect to such rate regardless of whether the loan is subsequently sold1 assigned1 or otherwise transferred to a third party1 and may be enforced by such third party notwithstanding any ,state law to the contrary4 4 7d7 ,amendment to the ,federal ,deposit ,insurance ,act ,section #bg of the ,federal ,deposit ,insurance ,act 7#ab ,u4,s4,c4 #ahca;d7 is amended by adding at the end the following3 7c7 ,a loan that is valid when made as to its maximum rate of interest in accordance with this section shall remain valid with respect to such rate regardless of whether the loan is subsequently sold1 assigned1 or otherwise transferred to a third party1 and may be enforced by such third party notwithstanding any ,state law to the contrary4 4 #d4 ,rule of construction ,nothing in this ,act may be construed as limiting the authority or jurisdiction of the ,office of the ,comptroller of the ,currency1 the ,federal ,deposit ,insurance ,corporation1 the ,board of ,governors of the ,federal ,reserve ,system1 the ,bureau of ,consumer ,financial ,protection1 or the ,national ,credit ,union ,administration4 ,january #cj1 #bjah ,committed to the ,committee of the ,whole ,house on the ,state of the ,union and ordered to be printed