Housing and Economic Recovery Act of 2008: Wikis


Note: Many of our articles have direct quotes from sources you can cite, within the Wikipedia article! This article doesn't yet, but we're working on it! See more info or our list of citable articles.


From Wikipedia, the free encyclopedia

The Housing and Economic Recovery Act of 2008 (Pub.L. 110-289, 122 Stat. 2654, enacted July 30, 2008) designed primarily to address the subprime mortgage crisis, was passed by the United States Congress on July 24, 2008 and signed by President George W. Bush on July 30, 2008. It authorizes the Federal Housing Administration to guarantee up to $300 billion in new 30-year fixed rate mortgages for subprime borrowers if lenders write-down principal loan balances to 90 percent of current appraisal value. It's intended to restore confidence in Fannie Mae and Freddie Mac by strengthening regulations and injecting capital into the two large U.S. suppliers of mortgage funding. States will be authorized to refinance subprime loans using mortgage revenue bonds. It also establishes the Federal Housing Finance Agency (FHFA) out of the Federal Housing Finance Board (FHFB) and Office of Federal Housing Enterprise Oversight (OFHEO).

Through the powers granted to FHFA, created by the act, on September 7, 2008, FHFA director James B. Lockhart III announced he had put Fannie Mae and Freddie Mac under the conservatorship of the FHFA. The action is "one of the most sweeping government interventions in private financial markets in decades".[1][2 ] [3]

Some provisions of the law were modified by the American Recovery and Reinvestment Act of 2009, which was signed into law by President Obama on February 17, 2009.[4]


Housing Assistance Tax Act of 2008

Includes a first-time home buyer refundable tax credit for purchases on or after April 9, 2008 and before July 1, 2009 equal to 10 percent of the purchase price of a principal residence, up to $7,500.

  • Phases out the credit for taxpayers with incomes over $75,000 ($150,000 for joint returns).
  • Requires taxpayers receiving the credit to repay it over 15 years in equal installments by imposing a surcharge on the taxpayers’ annual income tax.

The Act provides emergency assistance for the redevelopment of abandoned and foreclosed homes.

FHA Modernization Act of 2008

(Background: FHA stands for Federal Housing Administration. FHA loan is a federal assistance mortgage loan in the United States insured by the Federal Housing Administration.)

  • Increases the FHA loan limit from 95 percent to 110 percent of area median home price up to 150 percent of the GSE conforming loan limit, or $625,000), effective January 1, 2009.
  • Requires a down payment of at least 3.5 percent for any FHA loan.
  • Places a 12-month moratorium on HUD (abbreviation for United States Department of Housing and Urban Development) implementation of risk-based premiums.
  • Prohibits seller-financed down payments.
  • Allows down payment assistance from family members.

Federal Housing Finance Regulatory Reform Act of 2008

HOPE for Homeowners Act of 2008

  • Authorizes the FHA to insure up to $300 billion of 30 year fixed rate refinance loans up to 90% of appraised value for distressed borrowers.
  • Covers mortgage commitments made on or after October 1, 2008 through September 30, 2011.
  • Requires existing mortgage holders to accept the proceeds of the insured loan as payment in full for all pre-existing indebtedness.
  • Participation in this program is not required but voluntary for lenders.

As of February 2009, only 451 applications had been received and 25 loans finalized, far short of the estimated 400,000 homeowners who were expected to participate. This was attributed to high fees, high interest rates, the need for a reduction in principal on the part of the lender, and the requirement that the federal government receive 50% of any appreciation in value of the house. Congress began hearings on the program in February.[5]

Mortgage Disclosure Improvement Act of 2008

Secure and Fair Enforcement for Mortgage Licensing Act of 2008

The SAFE Act is part of the Housing and Economic Recovery Act of 2008, Pub.L. 110-289, 122 Stat. 2654, enacted July 30, 2008. SAFE is an acronym for "Secure and Fair Enforcement for Mortgage Licensing Act." It requires all states to have a loan originator licensing and registration system in place by August 1, 2009 (August 1, 2010 for legislatures that meet biennially). A state can participate in the Nationwide Mortgage Licensing System (NMLS), a registry operated jointly by the Conference of State Bank Supervisors/American Association of Residential Mortgage Regulators (CSBS/AARMR); if it does not meet the SAFE Act's requirements for licensing and registration of loan originators, the U.S. Department of Housing and Urban Development (HUD) will implement a loan originator licensing system for the state. The SAFE Act is intended to provide uniform licensing standards nationwide, as these licensing standards have been non-uniform from state to state for the past 20+ years. It is also designed to create a comprehensive licensing database so that all loan originators will be known and presumably, bad actors can be kept out of the industry. The national licensing system should enable government and consumers to track loan originators. Loan originators registered in the national database will be provided with a Unique Identifier number. Loan originators include those who take residential mortgage loan applications, assist borrowers to obtain or apply for mortgage loans, and those who negotiate residential mortgage loan terms. Persons who perform merely clerical or administrative tasks in connection with loan origination are not considered loan originators.


External links


Act summary

Enactment news

Source material

Up to date as of January 22, 2010

From Wikisource

Public Law 110-289
by the 110th Congress of the United States
Housing and Economic Recovery Act of 2008
Pub.L. 110−289, 122 Stat. 2654, H.R. 3221, enacted July 30, 2008.
Note: This is the original legislation as it was initially enacted. Like many laws, this statute may have since been amended once or many times, and the text contained herein may no longer be legally current. Follow the interlinks within the content or check to see What Links Here for more.


An Act

To provide needed housing reform and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

Section 1. Short Title; Table of Contents.

(a) Short Title.—
This Act may be cited as the ``Housing and Economic Recovery Act of 2008´´.
(b) Table of Content.[1]
The table of contents for this Act is as follows:
Sec. 1. Short Title; Table of Contents.
Sec. 1001. Short title.
Sec. 1002. Definitions.
Subtitle A—Improvement of Safety and Soundness Supervision
Sec. 1101. Establishment of the Federal Housing Finance Agency.
Sec. 1102. Duties and authorities of the Director.
Sec. 1103. Federal Housing Finance Oversight Board.
Sec. 1104. Authority to require reports by regulated entities.
Sec. 1105. Examiners and accountants; authority to contract for reviews of regulated entities; ombudsman.
Sec. 1106. Assessments.
Sec. 1107. Regulations and orders.
Sec. 1108. Prudential management and operations standards.
Sec. 1109. Review of and authority over enterprise assets and liabilities.
Sec. 1110. Risk-based capital requirements.
Sec. 1111. Minimum capital levels.
Sec. 1112. Registration under the securities laws.
Sec. 1113. Prohibition and withholding of executive compensation.
Sec. 1114. Limit on golden parachutes.
Sec. 1115. Reporting of fraudulent loans.
Sec. 1116. Inclusion of minorities and women; diversity in Agency workforce.
Sec. 1117. Temporary authority for purchase of obligations of regulated entities by Secretary of Treasury.
Sec. 1118. Consultation between the Director of the Federal Housing Finance Agency and the Board of Governors of the Federal Reserve System to ensure financial market stability .
Subtitle B—Improvement of Mission Supervision
Sec. 1121. Transfer of program approval and housing goal oversight.
Sec. 1122. Assumption by the Director of certain other HUD responsibilities.
Sec. 1123. Review of enterprise products.
Sec. 1124. Conforming loan limits.
Sec. 1125. Annual housing report.
Sec. 1126. Public use database.
Sec. 1127. Reporting of mortgage data.
Sec. 1128. Revision of housing goals.
Sec. 1129. Duty to serve underserved markets.
Sec. 1130. Monitoring and enforcing compliance with housing goals.
Sec. 1131. Affordable housing programs.
Sec. 1132. Financial education and counseling.
Sec. 1133. Transfer and rights of certain HUD employees.
Subtitle C—Prompt Corrective Action
Sec. 1141. Critical capital levels.
Sec. 1142. Capital classifications.
Sec. 1143. Supervisory actions applicable to undercapitalized regulated entities.
Sec. 1144. Supervisory actions applicable to significantly undercapitalized regulated entities.
Sec. 1145. Authority over critically undercapitalized regulated entities.
Subtitle D—Enforcement Actions
Sec. 1151. Cease and desist proceedings.
Sec. 1152. Temporary cease and desist proceedings.
Sec. 1153. Removal and prohibition authority.
Sec. 1154. Enforcement and jurisdiction.
Sec. 1155. Civil money penalties.
Sec. 1156. Criminal penalty.
Sec. 1157. Notice after separation from service.
Sec. 1158. Subpoena authority.
Subtitle E—General Provisions
Sec. 1161. Conforming and technical amendments.
Sec. 1162. Presidentially-appointed directors of enterprises.
Sec. 1163. Effective date.
Sec. 1201. Recognition of distinctions between the enterprises and the Federal Home Loan Banks.
Sec. 1202. Directors.
Sec. 1203. Definitions.
Sec. 1204. Agency oversight of Federal Home Loan Banks.
Sec. 1205. Housing goals.
Sec. 1206. Community development financial institutions.
Sec. 1207. Sharing of information among Federal Home Loan Banks.
Sec. 1208. Exclusion from certain requirements.
Sec. 1209. Voluntary mergers.
Sec. 1210. Authority to reduce districts.
Sec. 1211. Community financial institution members.
Sec. 1212. Public use database; reports to Congress.
Sec. 1213. Semiannual reports.
Sec. 1214. Liquidation or reorganization of a Federal Home Loan Bank.
Sec. 1215. Study and report to Congress on securitization of acquired member assets.
Sec. 1216. Technical and conforming amendments.
Sec. 1217. Study on Federal Home Loan Bank advances.
Sec. 1218. Federal Home Loan Bank refinancing authority for certain residential mortgage loans.
Subtitle A—OFHEO
Sec. 1301. Abolishment of OFHEO.
Sec. 1302. Continuation and coordination of certain actions.
Sec. 1303. Transfer and rights of employees of OFHEO.
Sec. 1304. Transfer of property and facilities.
Subtitle B—Federal Housing Finance Board
Sec. 1311. Abolishment of the Federal Housing Finance Board.
Sec. 1312. Continuation and coordination of certain actions.
Sec. 1313. Transfer and rights of employees of the Federal Housing Finance Board.
Sec. 1314. Transfer of property and facilities.
Sec. 1401. Short title.
Sec. 1402. Establishment of HOPE for Homeowners Program.
Sec. 1403. Fiduciary duty of servicers of pooled residential mortgage loans.
Sec. 1404. Revised standards for FHA appraisers.
Sec. 1501. Short title.
Sec. 1502. Purposes and methods for establishing a mortgage licensing system and registry.
Sec. 1503. Definitions.
Sec. 1504. License or registration required.
Sec. 1505. State license and registration application and issuance.
Sec. 1506. Standards for State license renewal.
Sec. 1507. System of registration administration by Federal agencies.
Sec. 1508. Secretary of Housing and Urban Development backup authority to establish a loan originator licensing system.
Sec. 1509. Backup authority to establish a nationwide mortgage licensing and registry system.
Sec. 1510. Fees.
Sec. 1511. Background checks of loan originators.
Sec. 1512. Confidentiality of information.
Sec. 1513. Liability provisions.
Sec. 1514. Enforcement under HUD backup licensing system.
Sec. 1515. State examination authority.
Sec. 1516. Reports and recommendations to Congress.
Sec. 1517. Study and reports on defaults and foreclosures.
Sec. 1601. Study and reports on guarantee fees.
Sec. 1602. Study and report on default risk evaluation.
Sec. 1603. Conversion of HUD contracts.
Sec. 1604. Bridge depository institutions.
Sec. 1605. Sense of the Senate.
Sec. 2001. Short title.
Sec. 2002. Emergency designation.
Sec. 2101. Short title.
Subtitle A—Building American Homeownership
Sec. 2111. Short title.
Sec. 2112. Maximum principal loan obligation.
Sec. 2113. Cash investment requirement and prohibition of seller-funded down payment assistance.
Sec. 2114. Mortgage insurance premiums.
Sec. 2115. Rehabilitation loans.
Sec. 2116. Discretionary action.
Sec. 2117. Insurance of condominiums.
Sec. 2118. Mutual Mortgage Insurance Fund.
Sec. 2119. Hawaiian home lands and Indian reservations.
Sec. 2120. Conforming and technical amendments.
Sec. 2121. Insurance of mortgages.
Sec. 2122. Home equity conversion mortgages.
Sec. 2123. Energy efficient mortgages program.
Sec. 2124. Pilot program for automated process for borrowers without sufficient credit history.
Sec. 2125. Homeownership preservation.
Sec. 2126. Use of FHA savings for improvements in FHA technologies, procedures, processes, program performance, staffing, and salaries.
Sec. 2127. Post-purchase housing counseling eligibility improvements.
Sec. 2128. Pre-purchase homeownership counseling demonstration.
Sec. 2129. Fraud prevention.
Sec. 2130. Limitation on mortgage insurance premium increases.
Sec. 2131. Savings provision.
Sec. 2132. Implementation.
Sec. 2133. Moratorium on implementation of risk-based premiums.
Subtitle B—Manufactured Housing Loan Modernization
Sec. 2141. Short title.
Sec. 2142. Purposes.
Sec. 2143. Exception to limitation on financial institution portfolio.
Sec. 2144. Insurance benefits.
Sec. 2145. Maximum loan limits.
Sec. 2146. Insurance premiums.
Sec. 2147. Technical corrections.
Sec. 2148. Revision of underwriting criteria.
Sec. 2149. Prohibition against kickbacks and unearned fees.
Sec. 2150. Leasehold requirements.
Sec. 2201. Temporary increase in maximum loan guaranty amount for certain housing loans guaranteed by the Secretary of Veterans Affairs.
Sec. 2202. Counseling on mortgage foreclosures for members of the Armed Forces returning from service abroad.
Sec. 2203. Enhancement of protections for servicemembers relating to mortgages and mortgage foreclosures.
Sec. 2301. Emergency assistance for the redevelopment of abandoned and foreclosed homes.
Sec. 2302. Nationwide distribution of resources.
Sec. 2303. Limitation on use of funds with respect to eminent domain.
Sec. 2304. Limitation on distribution of funds.
Sec. 2305. Counseling intermediaries.
Sec. 2401. Housing counseling resources.
Sec. 2402. Credit counseling.
Sec. 2501. Short title.
Sec. 2502. Enhanced mortgage loan disclosures.
Sec. 2503. Community Development Investment Authority for depository institutions.
Sec. 2601. Home improvements and structural alterations for totally disabled members of the Armed Forces before discharge or release from the Armed Forces.
Sec. 2602. Eligibility for specially adapted housing benefits and assistance for members of the Armed Forces with service-connected disabilities and individuals residing outside the United States.
Sec. 2603. Specially adapted housing assistance for individuals with severe burn injuries.
Sec. 2604. Extension of assistance for individuals residing temporarily in housing owned by a family member.
Sec. 2605. Increase in specially adapted housing benefits for disabled veterans.
Sec. 2606. Report on specially adapted housing for disabled individuals.
Sec. 2607. Report on specially adapted housing assistance for individuals who reside in housing owned by a family member on permanent basis.
Sec. 2608. Definition of annual income for purposes of section 8 and other public housing programs.
Sec. 2609. Payment of transportation of baggage and household effects for members of the Armed Forces who relocate due to foreclosure of leased housing.
Sec. 2701. Short title.
Sec. 2702. Public housing agency plans for certain qualified public housing agencies.
Subtitle A—Preservation Under Federal Housing Programs
Sec. 2801. Clarification of disposition of certain properties.
Sec. 2802. Eligibility of certain projects for enhanced voucher assistance.
Sec. 2803. Transfer of certain rental assistance contracts.
Sec. 2804. Public housing disaster relief.
Sec. 2805. Preservation of certain affordable housing.
Subtitle B—Coordination of Federal Housing Programs and Tax Incentives for Housing
Sec. 2831. Short title.
Sec. 2832. Approvals by Department of Housing and Urban Development.
Sec. 2833. Project approvals by rural housing service.
Sec. 2834. Use of FHA loans with housing tax credits.
Sec. 2835. Other HUD programs.
Sec. 2901. Homeless assistance.
Sec. 2902. Increasing access and understanding of energy efficient mortgages.
Sec. 3000. Short title; etc.
Subtitle A—Multi-Family Housing
Part I—Low-Income Housing Tax Credit
Sec. 3001. Temporary increase in volume cap for low-income housing tax credit.
Sec. 3002. Determination of credit rate.
Sec. 3003. Modifications to definition of eligible basis.
Sec. 3004. Other simplification and reform of low-income housing tax incentives.
Sec. 3005. Treatment of military basic pay.
Part II—Modifications to Tax-Exempt Housing Bond Rules
Sec. 3007. Recycling of tax-exempt debt for financing residential rental projects.
Sec. 3008. Coordination of certain rules applicable to low-income housing credit and qualified residential rental project exempt facility bonds.
Part III—Reforms Related to the Low-Income Housing Credit and Tax-Exempt Housing Bonds
Sec. 3009. Hold harmless for reductions in area median gross income.
Sec. 3010. Exception to annual current income determination requirement where determination not relevant.
Subtitle B—Single Family Housing
Sec. 3011. First-time homebuyer credit.
Sec. 3012. Additional standard deduction for real property taxes for nonitemizers.
Subtitle C—General Provisions
Sec. 3021. Temporary liberalization of tax-exempt housing bond rules.
Sec. 3022. Repeal of alternative minimum tax limitations on tax-exempt housing bonds, low-income housing tax credit, and rehabilitation credit.
Sec. 3023. Bonds guaranteed by Federal home loan banks eligible for treatment as tax-exempt bonds.
Sec. 3024. Modification of rules pertaining to FIRPTA nonforeign affidavits.
Sec. 3025. Modification of definition of tax-exempt use property for purposes of the rehabilitation credit.
Sec. 3026. Extension of special rule for mortgage revenue bonds for residences located in disaster areas.
Sec. 3027. Transfer of funds appropriated to carry out 2008 recovery rebates for individuals.
Subtitle A—Foreign Currency and Other Qualified Activities
Sec. 3031. Revisions to REIT income tests.
Sec. 3032. Revisions to REIT asset tests.
Sec. 3033. Conforming foreign currency revisions.
Subtitle B—Taxable REIT Subsidiaries
Sec. 3041. Conforming taxable REIT subsidiary asset test.
Subtitle C—Dealer Sales
Sec. 3051. Holding period under safe harbor.
Sec. 3052. Determining value of sales under safe harbor.
Subtitle D—Health Care REITs
Sec. 3061. Conformity for health care facilities.
Subtitle E—Effective Dates
Sec. 3071. Effective dates.
Subtitle A—General Provisions
Sec. 3081. Election to accelerate the AMT and research credits in lieu of bonus depreciation.
Sec. 3082. Certain GO Zone incentives.
Sec. 3083. Increase in statutory limit on the public debt.
Subtitle B—Revenue Offsets
Sec. 3091. Returns relating to payments made in settlement of payment card and third party network transactions.
Sec. 3092. Gain from sale of principal residence allocated to nonqualified use not excluded from income.
Sec. 3093. Delay in application of worldwide allocation of interest.
Sec. 3094. Time for payment of corporate estimated taxes.

Approved July 30, 2008.


  1. So in original. Probably should be "…Contents."

Legislative History

  • Vol. 153 (2007):
    • Aug. 4, considered and passed House.
  • Vol. 154 (2008):
    • Apr. 3, 4, 7-10, considered and passed Senate, amended.
    • May 8, House concurred in Senate amendment with amendments.
    • June 19, 20, 23-26, July 7-11, Senate considered and concurred in House amendments with amendment.
    • July 23, House concurred in Senate amendment with amendment.
    • July 25, 26, Senate considered and concurred in House amendment.


Got something to say? Make a comment.
Your name
Your email address