,i  #aafth ,,congress  #ast ,session    
,h4 ,r4 #ceaa  ,,in ,,the ,,house ,,of  
,,representatives  ,june #bf1 #bjai,ms4 
,kaptur 7for herself1 ,mr4 ,clay1 ,mrs4 
,axne1 and ,ms4 ,jayapal7 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 homes owned by the ,federal  
,government1 the ,federal ,national     
,mortgage ,association1 the ,federal    
,home ,loan ,mortgage ,corporation1 and 
local land banks1 and for other         
purposes4  #a4 ,short title ,this ,act  
may be cited as the ,transforming       
,student ,debt to ,home ,equity ,act of 
#bjai4  #b4 ,findings ,congress finds   
the following3  7#a7 ,in the first      
quarter of #bjai1 over #af1hjj1jjj 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 #a1efj1jjj1jjj1jjj4  7#d7 ,more  
than #dd1gjj1jjj ,americans have at     
least one outstanding student loan1 up  
dramatically from #cg1jjj1jjj ,americans
 just #g 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 ,data from the ,united  
,states ,census ,bureau shows that      
non-,hispanic ,white households have an 
average net worth of #acj1hjj1 while    
,black households have an average net   
worth of #i1eij and ,hispanic households
 have #ag1ecj2 providing innovative     
financial products will allow the       

,united ,states to close the racial     
wealth gap and to ensure equitable      
access to housing and economic mobility4
  7#g7 ,according to a report from ,pew 
,research ,center1 the median income of 
,african-,american households decreased 
by #ec percent between #bjjh and #bjac4 
,in the same time period1 the income gap
 between ,white households and          
,african-,american households widened2  
increasing from #ac times greater to #ag
 times greater4  7#h7 ,it is imperative 
to create a demonstration program to    
design financial pathways to1 where     
possible1 to systematically convert some
 student debt streams into equity       
streams through negotiation of          
mortgages2 otherwise housing purchases  
will continue to be sluggish among first
 time home-buyers and thousands more    
,americans will enter their midyears    
saddled with student loan debt never    
having had the opportunity to accumulate
 equity4  7#i7 ,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#aj7 ,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#aa7 ,the goal is to       
connect creditworthy ,federal student   
debt holders with housing properties for
 sale and held by the ,federal          
,government and local land banks4  7#ab7
 ,over time1 participants can help      
restore neighborhoods1 transform their  
debt to equity1 and stabilize secured   
property values locally and on the      
,federal ledger 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 establish and    
carry out a pilot demonstration program 
to--  7#a7 provide assistance to        
eligible applicants in purchasing       
eligible properties2 and  7#b7          
subsequently analyze the results of the 
provision of such assistance4  7b7      
,consultation ,in establishing and      
carrying out the program pursuant to    
subsection 7a71 the ,secretary of the   
,department of ,housing and ,urban      
,development and the ,director of the   
,federal ,housing ,finance ,agency shall
 consult with--  7#a7 the ,director of  
the ,consumer ,financial ,protection    
,bureau2  7#b7 the ,secretary of        
,agriculture2  7#c7 the ,secretary of   
,veteran ,affairs2  7#d7 the ,secretary 
of ,education2 and  7#e7 the ,secretary 
of the ,treasury4  7c7 ,eligible        
applicants ,to be eligible for the      
program established pursuant to         

subsection 7a71 an applicant--  7#a7    
shall have an outstanding balance of    
principal or interest owing on a        
,federal 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 section2 
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 section  
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  7d7 ,types of assistance 
7#a7 ,in general ,a program established 
under this section 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  
,any other assistance that the          
,secretary and ,director jointly deem   
appropriate4  7#b7 ,repayment           
integration ,a program established under
 this section shall provide for the     
development of a program that will use  
actuarial information to determine how  
the repayment of loans described in     
subsection 7c77#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#c7          
,collaboration ,in providing assistance 
described under paragraph 7#a71 the     
,secretary and the ,director may        
collaborate with--  7,a7 community banks
 having less than #aj1jjj1jjj1jjj in    
total assets2  7,b7 credit unions 7as   
defined in section #aja of the ,federal 
,credit ,union ,act72  7,c7 and local   
fair housing organizations2 and  7,d7   
local land banks4  7e7 ,geographical    
diversity ,in selecting eligible        
applicants to receive assistance under  
this section1 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  7f7 ,reports  7#a7 ,interim
 report ,not later than #ij days after  
the date of the enactment of this       
section1 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 section4 
7#b7 ,final report ,not later than #c   
years after the date of the enactment of
 this section1 the ,secretary and the   
,director shall submit to ,congress a   
final report that--  7,a7 evaluates the 
impact of the program carried out under 
this section and describes any findings2
  7,b7 identifies other types of        
assistance the ,secretary and the       
,director may offer2 and  7,c7 includes 
any recommendations the ,secretary and  
,director may have for improving the    
program4  7g7 ,definitions ,in this     
section3  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     
7ii7 is a real estate owned property of 
the ,federal ,national ,mortgage        
,association or the ,federal ,home ,loan
 ,mortgage ,corporation2 or  7iii7 is   
owned by a local land bank4  7#d7 ,local
 land bank ,the term local land bank    
means--  7,a7 a governmental or         
nongovernmental nonprofit entity        
established1 at least in part1 to       

assemble1 temporarily manage1 and       
dispose of vacant land for the purpose  
of stabilizing neighborhoods and        
encouraging re-use or redevelopment of  
urban property2 or  7,b7 such other     
governmental or nongovernmental entity  
as the ,secretary and the ,director may 
determine appropriate4  7h7             
,authorization of appropriations ,there 
are authorized to be appropriated such  
sums as necessary to carry out this     
section for fiscal years #bjba1 #bjbb1  
and #bjbc4