H. R. 6153
IN THE HOUSE OF REPRESENTATIVES
July 19, 2012
Mr. McNerney (for himself, Mr. Rooney, Mr. Cardoza, Mr. Nugent, Mr. George Miller of California, Mr. Costa, and Ms. Lee of California) introduced the following bill; which was referred to the Committee on Financial Services
To require the holder of a subordinate lien on the property that secures a federally related mortgage loan, upon a request by the homeowner for a short sale, to make a timely decision whether to allow the sale.
This Act may be cited as the
Fast Help For Homeowners
Requirement for prompt decision
Chapter 2 of the Truth in Lending Act (15 U.S.C. 1631 et seq.) is amended by inserting before section 130 (15 U.S.C. 1640) the following new section:
Prompt decision making regarding short sale
Not later than the end of the 10-calendar day period beginning on the date of receipt of a written request from a mortgagor of a federally related mortgage loan that meets the requirements of subsection (c), a servicer shall—
notify in writing each holder of a subordinate lien on the residential real property that secures such loan of such request; and
submit to each such holder a copy of such request.
Timely response to servicer notification required
Timely response required
Except as provided in subsection (d) and notwithstanding any other provision of law or of any contract, including a contract between a servicer of a federally related mortgage loan and a securitization vehicle or other investment vehicle, a holder of a subordinate lien that is notified by a servicer under subsection (a) shall respond in writing to such servicer not later than the end of the 45-calendar day period beginning on the date of receipt of such notification.
Failure to respond
If the holder of a subordinate lien that is notified by a servicer under subsection (a) does not respond within the 45-calendar day period described in subparagraph (A), the request from a mortgagor described in subsection (a) shall be considered to have been approved by the such holder.
A written response by such holder under subsection (a) shall specify a decision on whether the request described in such subsection has been denied, approved, or that such request has been approved subject to specified changes.
Subsection (a) shall apply in any case in which the mortgagor of a federally related mortgage loan submits to the servicer thereof—
a written offer for a short sale of the dwelling or residential real property that is subject to a mortgage, deed of trust, or other security interest that secures the mortgage loan; and
all information required by the servicer in connection with such a request (including a copy of an executed contract between the owner of the dwelling or property and the prospective buyer that is subject to approval by the servicer).
Inapplicability to certain existing mortgages
This section shall not apply to any federally related mortgage loan with respect to which the mortgagor and the mortgagee or servicer have entered into a written agreement before the date of the enactment of the Short Sales Taking A New Direction Act explicitly providing a procedure or terms for approval of a short sale.
Treatment of other time limits
This section may not be construed to preempt, annul, or otherwise affect any other provision of law or of any contract or program that provides a shorter period than is provided under subsection (b) for a decision to be made by a holder of a subordinate lien described in subsection (a)(1) regarding a short sale.
For purposes of this section, the following definitions shall apply:
Federally related mortgage loan
The term federally related mortgage loan has the same meaning as is given in section 3 of the Real Estate Settlement Procedures Act of 1974 (12 U.S.C. 2602).
The term securitization vehicle means a trust, special purpose entity, or other legal structure that is used to facilitate the issuing of securities, participation certificates, or similar instruments backed by or referring to a pool of assets that includes federally related mortgage loans (or instruments that are related to federally related mortgage loans, such as credit-linked notes).
The term servicer has the same meaning as in section 129A, except that such term includes a person who makes or holds a federally related mortgage loan (including a pool of federally related mortgage loans), if such person also services the loan.
The term short sale means the sale of the dwelling or residential real property that is subject to the mortgage, deed or trust, or other security interest that secures a federally related mortgage loan that—
will result in proceeds in an amount that is less than the remaining amount due under the mortgage loan; and
requires authorization by the securitization vehicle or other investment vehicle or holder of the mortgage loan, or the servicer acting on behalf of such a vehicle or holder.
The amendment made by subsection (a) shall apply to any written request for a short sale made after the date of the enactment of this Act.