Keeping Families Home Act of 2015
Directs each mortgage servicer to establish a deed-for-lease program which shall permit an eligible mortgagor to:
Exempts small servicers from such requirement.
Requires a lease to carry a monthly rent amount equal to the fair market rent for the property, as determined by an independent private appraiser hired by and paid by the servicer.
[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1878 Introduced in House (IH)]
114th CONGRESS
1st Session
H. R. 1878
To require servicers to establish a deed-for-lease program under which
eligible mortgagors may remain in their homes as renters.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 16, 2015
Ms. Michelle Lujan Grisham of New Mexico introduced the following bill;
which was referred to the Committee on Financial Services
_______________________________________________________________________
A BILL
To require servicers to establish a deed-for-lease program under which
eligible mortgagors may remain in their homes as renters.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Keeping Families Home Act of 2015''.
SEC. 2. DEED-FOR-LEASE PROGRAM.
(a) Establishment.--
(1) In general.--Each servicer shall establish a deed-for-
lease program (hereinafter referred to as the ``Program''),
which shall permit an eligible mortgagor to--
(A) enter into a deed in lieu of foreclosure
agreement;
(B) continue to occupy and lease the property that
is the subject of such agreement for a 1-year period
that begins on the date of such agreement; and
(C) have a right of first refusal to purchase such
property after the end of the 1-year lease period, if
the owner of the property intends to sell the property
at that time.
(2) Exception for small servicers.--The Program requirement
under paragraph (1) shall not apply to a small servicer, as
such term is defined by the Secretary of Housing and Urban
Development.
(b) Notice Requirement.--Servicers shall provide each eligible
mortgagor with information about the Program and how to apply to
participate in the Program.
(c) Lease Terms.--A lease entered into by an eligible mortgagor
under the Program shall--
(1) carry a monthly rent amount equal to the fair market
rent for such property, as determined by an independent private
appraiser hired by and paid by the servicer; and
(2) contain all typical lease provisions for similar rental
property.
(d) Application Process.--
(1) In general.--An eligible mortgagor may apply for the
Program at any time.
(2) Effect of foreclosure sale.--If there is a foreclosure
sale pending with respect to the property--
(A) the eligible mortgagor may only apply for the
Program before the date that is 7 days before the date
of such foreclosure sale; and
(B) once the eligible mortgagor applies for the
Program, the foreclosure sale shall be halted until
after the eligible mortgagor's Program application has
been evaluated.
(3) Contents of application.--
(A) In general.--In applying for the Program, an
eligible mortgagor shall provide the servicer with
proof of the following information:
(i) The eligible mortgagor is subject to a
financial hardship that makes the eligible
mortgagor unable to continue making timely
payments on the eligible mortgage loan.
(ii) The eligible mortgagor is eligible to
pay the monthly rent amount described under
subsection (c)(1) and such amount is no more
than 31 percent of the eligible mortgagor's
monthly income.
(iii) The eligible mortgagor currently
lives in the property and intends to continue
doing so during the 1-year lease term.
(B) Ability to pay higher percentage of income in
rent.--Notwithstanding subparagraph (A)(ii), if an
eligible mortgagor believes they are able pay the
monthly rent amount despite such amount exceeding 31
percent of the eligible mortgagor's monthly income, the
eligible mortgagor may request that the Department of
Housing and Urban Development review their information,
along with any contributing factors the eligible
mortgagor may have (such as a low debt burden) and, if
the Department notifies the eligible mortgagor that the
Department agrees that the eligible mortgagor is able
to pay a monthly rent amount that is equal to a
percentage of their monthly income that is higher than
31 percent, such higher percentage shall be used for
purposes of subparagraph (A)(ii).
(4) Effect of junior liens.--If an eligible mortgagor
applies for a Program with respect to a single family property
subject to a junior lien--
(A) if the servicer of the Program is also the
holder of the junior lien, the servicer shall release
the junior lien and, subject to the other requirements
of this section, the eligible mortgagor shall be
eligible to participate in the Program; and
(B) if the servicer of the Program is not the
holder of the junior lien, the servicer shall contact
such junior lien holder and request that the holder
release the lien, and--
(i) if the holder releases the lien, then,
subject to the other requirements of this
section, the eligible mortgagor shall be
eligible to participate in the Program; and
(ii) if the holder does not release the
lien, then the eligible mortgagor shall not be
eligible to participate in the Program.
(e) Evaluation and Notification.--
(1) Deadline for evaluation.--The servicer shall evaluate
the eligible mortgagor's application within 30 days of
receiving such application and shall accept an eligible
mortgagor into the Program if the eligible mortgagor has
provided the proof described under subsection (d)(3)(A).
(2) Notification.--Promptly after making a determination
under paragraph (1), the servicer shall notify the eligible
mortgagor of such determination in writing and, if the servicer
determines that the eligible mortgagor may not be accepted into
the Program, the servicer shall specifically explain in writing
why the eligible mortgage was not accepted.
(f) Subsequent Owners Follow Program Requirements.--Any subsequent
owner of the property being leased pursuant to the Program shall--
(1) maintain the Program and abide by the terms of the
Program to the same extent as the servicer of the eligible
mortgage; and
(2) certify to the Department of Housing and Urban
Development, before finalizing any purchase of the property,
that they will abide by the terms of the Program.
(g) Rulemaking; Compliance Evaluation.--The Department of Housing
and Urban Development shall--
(1) issue such regulations as may be necessary to carry out
this section;
(2) evaluate the compliance by servicers and owners with
the requirements of this section; and
(3) enforce the requirements of this section.
(h) Definitions.--For purposes of this section:
(1) Eligible mortgagor.--The term ``eligible mortgagor''
means a mortgagor under an eligible mortgage.
(2) Eligible mortgage.--The term ``eligible mortgage''
means a first or subordinate mortgage on a property that--
(A) is a single family property; and
(B) is currently being used as the principal
residence of the eligible mortgagor.
(3) Single family property.--The term ``single family
property'' means--
(A) a structure consisting of 1 to 4 dwelling
units;
(B) a dwelling unit in a multi-unit condominium
property together with an undivided interest in the
common areas and facilities serving the property;
(C) a dwelling unit in a multi-unit project for
which purchase of stock or a membership interest
entitles the purchaser to permanent occupancy of that
unit; or
(D) a manufactured housing unit.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Financial Services.
Llama 3.2 · runs locally in your browser
Ask anything about this bill. The AI reads the full text to answer.
Enter to send · Shift+Enter for new line