TITLE-III -- Homeownership


Subtitle A-National Homeownership Trust Act

The House amendment contained a provision not included in the Senate
bill that established the National Trust in the Department of Housing
and Urban Development to provide interest rate buydowns and downpayment
assistance to first-time homebuyers. The conference report contains the
House provision with an amendment to change the name to "National
Homeownership Trust Act", to limit participation in the Trust to
homebuyers who are 95 percent of median area income for family of four
persons (adjusted for family size), except in FHA high cost areas where
the limit will be 115 percent of median area income for a family of four
persons (adjusted for family size), and to include three demonstration
programs. The amendment also requires participating homebuyers to have
paid not less than 1 percent of the cost of acquisition of the property
(excluding any mortgage insurance premium paid at the time the mortgage
is insured).

The Trust was created to address the decline in first-time homeownership
due to high costs of housing, high costs involved in financing the
purchase of a home, and the tighter underwriting standards in the
mortgage marketplace. The Committee believes that the Trust provides
vitally needed homeownership opportunities to low and moderate income
families who could not otherwise afford to purchase a home through
interest rate buydowns to a rate not to exceed 6 percent and through
downpayment assistance.

The Trust would provide two forms of assistance to first-time homebuyers
(including homebuyers buying shares in limited equity cooperatives): (1)
payments to ensure that a rate of interest payable on the mortgages by
the homebuyers does not exceed 6 percent; and (2) payments to provide
some or all of the downpayment (including closing costs and other costs
payable at the time of closing) required by first-time homebuyers.

The House provision provided that the aggregate income of the homebuyer
and family members residing with the homebuyer could not exceed 115
percent of the area median income for a family of four (adjusted for
family size) during the 12 months prior to the date of application for
assistance. The conference report amends this provision so that the
aggregate income of the homebuyer and family members residing with the
homebuyer can not exceed 95 percent of the area median income for a
family of four (adjusted for family size), except in areas that are
subject to a high cost area mortgage limit under Title II of the
National Housing Act (FHA). In such areas, the homebuyer's income cannot
exceed 115 percent of the area median for a family of four (adjusted for
family size). The Secretary would be required to provide for the
recertification of income every two years. The homebuyer would be
required to certify that the homebuyer has made a good faith effort to
obtain a market rate mortgage and has been denied such mortgage because
the income of the homebuyers is insufficient. The assisted property
would have to be a single-family residence or unit in a cooperative and
the principal residence of the homebuyer. The principal obligation of
the mortage could not exceed the maximum amount which can be insured
under the National Housing Act. The mortgagee must be federally-insured
or otherwise approved by the Trust. The House provision required
mortgages under this program to be insured; the conference report does
not. The conferees omitted this provision to provide flexibility in
underwriting; however, the conferees want to make clear that the Trust
is not intended to be an insurer. The interest rate on the mortgage
would be a fixed rate and cannot exceed the maximum rate established by
the Trust.

To receive downpayment assistance under this subtitle, the homebuyer
would be required to pay at least one percent of the cost of
acquisition. Since the absence of equity has been shown to contribute
to homeowner default, the Committee requires that the homebuyer
contribute at least one percent of the cost of acquisition to insure
sufficient equity in the home to avert default. This equity contribution
could be applied toward the downpayment requirement under FHA insured
loans. Assistance payments must be secured by a subordinate lien on the
assisted property. Assistance must be repaid without interest upon the
sale of the property if there are proceeds from such sale.

If the homebuyer's income exceeds 115 percent of median income for two
years or if the assisted property ceases to be the principal residence
of the homebuyer, the Trust could require that the homebuyer begin to
repay any assistance payments before any sale. The Trust could provide
both interest rate assistance and down payment assistance at the same
time to a single homebuyer. The Secretary would be required to allocate
the assistance in a manner to assure equitable distribution among the
States based on the number of a eligible first-time homebuyers. The
Committee intends that, in determining the need of eligible first-time
homebuyers for assistance, the Secretary will take into account the
fiscal capacity of first-time homebuyers in an area to afford a typical
starter home within the area.

National Housing Trust Fund

The National Housing Trust Fund would be established in the Treasury.
The Fund would consist of any appropriations and any repayments to the
Fund, and any amount that the Trust earns on its investments in U.S.
government securities. The Trust would be permitted to invest any amount
beyond what is necessary to carry out the provisions of the Title in the
obligations of the United States.

The House amendment contained three combined housing and economic
development demonstrations in the Community Housing Partnership which
were not contained in the Senate bill which the conference report now
contains within the National Homeownership Trust Act. The first
demonstration program is in Milwaukee, Wisconsin, for development,
rehabilitation, and revitalization of 2 vacant structures in a blighted
minority neighborhood, for which $4,200,000 is authorized out of the
Trust. The second demonstration progarm is in Washington, District of
Columbia, for non-profit neighborhood-based groups to acquire and
rehabilitate vacant public and private housing for resale or rent to low
and moderate-income families and to engage in neighborhood-based
economic development activities, for which $10,000,000 is authorized out
of the Trust. The third demonstration is in Philadelphia, Pennsylvania,
for technical assistance and organizational support for a community
development corporation that is a city-wide public/private partnership
engaged in the provision of technical assistance to neighborhood
community development corporations, for which $1,000,000 is authorized
out of the Trust.

The House amendment authorized $500 million for fiscal year 1991 and
such sums for FY 1992 and FY 1993 to remain available until expended.
The conference report authorizes $250,000,000 for FY 1991 and
$521,500,000 for FY 1992.

The Secretary would be authorized to conclude the affairs of the Trust
after termination. If the Secretary determines that the Trust is no
longer necessary, the Secretary could transfer any remaining Trust funds
to the Treasury. The Trust would terminate on September 30, 1993.

Downpayment savings

Study: The Senate bill contained a provision that was not included in
the House amendment that would require the Secretary to study the actual
soundness of implementing a program to guarantee downpayments for
first-time homebuyers based on a system of downpayment savings accounts
and payment schedules that require monthly or other periodic payments
over a specified period of time in an amount equal to a specified
percentage of the value of housing at the time of purchase. The
conference report does not contain the Senate provision.

HOME Demonstration: The House amendment contained a provision that was
not included in the Senate bill that would provide matching
contributions for downpayments. It would provide funds for "matching
contributions certificate" to eligible buyers who have established a
HOME savings certificate account. Matching contribution certificates
would be issued annually for each year of buyer's eligibility. Such
certificates can only be redeemed in connection with the purchase of a
principal residence by an eligible buyer under this part. The conference
report does not contain the House provision.

Subtitle B-FHA and Secondary Mortgage Market

FHA mortgage insurance authority: The House amendment contained a
provision that would limit aggregate FHA mortgage insurance authority
to $76,791,000,000 for FY 1991. The conference report contains the House
provision with an amendment that would limit such authority for FY 1992
to $79,818,000,000.

Appraisal services: The House amendment contained a provision not
included in the Senate bill that allows mortgages approved for the FHA
direct endorsement program to contract with an appraiser, including
partnerships or sole proprietorships organized as corporations, to
conduct an appraisal so long as such appraisals are consistent with
standards and qualifications established by the Secretary. Individuals
that meet the requirements for inclusion on fee panels established by
the Secretary shall be eligible for such assignments notwithstanding
their employment by an appraisal company and the contract for such
persons services may be made with the employer. The conference report
contains the House provision. This provision conforms with the appraisal
reform provisions of FIRREA and with the policies and practices of the
Federal financial institutions regulatory agencies, Fannie Mae an
Freddie Mac. The conferees recognize that while this provision requires
HUD to recognize valuation services provided by appraisal companies when
those companies employ qualified appraisers, it continues the
Secretary's full authority and responsibility for assuring the integrity
of HUD related appraisal services. The conferees believe that this
provision will improve the quality and reliability of appraisal services
in connection with HUD mortgage assistance and other housing programs;
will promote uniformity among government agencies on the issue of
eligibility to perform appraisals in federally related transactions; and
will allow mortgage lenders who participate in HUD residential mortgage
insurance programs to be more efficient in the appraisal component of
the underwriting process. The conferees believe the Secretary should
approve and certify appraisers consistent with the Secretary's
prescribed standards for all HUD approved fee appraisers or such other
standards as the Secretary may prescribe.

FHA loan limit: The House amendment contained a provision that would
amend Section 203(b)(2) to raise FHA maximum loan limits to 185% of area
median ($124,875) on a permanent basis. The Senate bill contained a
similar provison except it would only authorize the raised limit for two
more years, until September 30, 1992. The conference report contains the
House provision.

Mortgagor equity: The House amendment contained a provision that would
limit the FHA insured principal obligation (including such initial
service charges, appraisal, inspection, mortgage insurance premiums, and
other fees as the Secretary approves) to no more than the appraised
value of the property. This change would apply to mortgages entered into
on or after October 1, 1992. The Senate bill contained provision that
would limit FHA insured mortgages to principal obligations of no more
than 98 percent of the properties appraised at less than $50,000 and 97
percent in the case of properties with an appraised value above $50,000,
plus the amount of the mortgage insured premium. "Appraised value"
would mean the amount required to be set forth in a written statement
as the appraised value of the property under Section 226 of the National
Housing Act, or a similar amount determined by the Secretary, if Section
226 does not apply. The conference report contains the Senate provision
with an amendment to change the limit of a FHA insured mortgage to a
principal obligation from no more than 98 percent to no more than 98.75
percent of the appraised value of the property and from 97 percent to
97.75 percent in the case of a mortgage with an appraised value in
excess of $50,000.

Mortgage insurance premium on 1-4 family dwellings

Up-front: The House amendment contained a provision that would require
the Secretary to collect, at the time of insurance, a premium payment
of 1.35 percent of the amount of the original insured principal
obligation of the mortgage, which may be financed. The Senate bill did
not contain a similar provision but would retain current law which
requires at the time of insurance a premium payment of 3.8 percent of
the amount of the original insured principal obligation of the mortgage,
which may be financed. The conference report contains the House
provision with an amendment to change the 1.35 percent insurance premium
payment to 2.25 percent.

Periodic: The House amendment contained a provision that would provide
for periodic premium payments of 0.6 percent of the remaining insured
principal balance, and would not refund any part of the periodic premium
upon prepayment. The Senate bill contained a provision that would permit
the Secretary to require an additional premium charge on a periodic
basis as determined by the Secretary to be consistent with sound
actuarial practice and taking into account high loan-to-value ratios.
The additional premium charge may not exceed an amount equal to 0.5
percent of the outstanding principal obligation of the mortgage without
taking into account delinquent payments or prepayments. Such additional
premium charge was required (A) for up to 15 years if the initial
loan-to-value ratio of the mortgage is greater than 95 percent, (B) for
up to 10 years if the initial loan-to-value ratio is equal to or less
than 95 percent but equal to or greater than 93 percent, and (C) for up
to 4 years if the initial loan-to-value ratio is less than 93 percent
but greater than or equal to 90 percent. The conference report contains
the Senate provision with an amendment that requires a premium charge
of 0.5 percent (A) for the first 11 years if the initial loan-to-value
ratio of the mortgage is less than 90 percent of the appraised value,
(B) for the first 30 years if the initial loan-to-value ratio of the
mortgage is greater than or equal to 90 percent of the appraised value,
and (C) for mortgages with an initial loan-to-value ratio greater than
95 percent of the appraised value, a premium charge of 0.55 percent for
the first 30 years.

Effective date: The House amendment contained a provision which would
require that the modified premium structure amendment apply to mortgages
insured on or after October 1, 1995. The Senate bill contained no
similar provision. The conference report contains the House provision
with an amendment to change the effective date to October 1, 1994.

Transition: The House amendment contained a provision not included in
the Senate bill which provides for transition rules under which upfront
and periodic premium changes are phased in: 1991-92, 3.75% up-front,
.24% periodic; 1993-95, 2.15% up-front, .48% periodic; 1996, 1.35%
up-front, .60% periodic. The conference report contains the House
provision amended to provide for transition rules as follows: (A) for
mortgages executed during FYs 1991 and 1992 (but after the effective
date of regulations), an up-front premium of 3.8 percent and an annual
premium of 0.5 percent for mortgages (i) less than 90 percent of the
appraised value for the first 5 years, (ii) greater than or equal to 90
percent of the appraised value but equal to or less than 95 percent of
such value, for the first 8 years, and (iii) greater than 95 percent of
such value, for the first 10 years; (B) for mortgages executed during
FYs 1993 and 1994, an up-front premium of 3.0 percent and an annual
premium of 0.5 percent for mortgages (i) less than 90 percent of the
appraised value for the first 7 years, (ii) greater than or equal to 90
percent of the appraised value but equal to or less than 95 percent of
such value, for the first 12 years, and (iii) greater than 95 percent
of such value, for the first 30 years.

Refunds: The House amendment contained a provision which would prohibit
refunding the 1.35 percent up front premium. For mortgages insured
during fiscal years 1991-1995, the Secretary could refund up to 50
percent of the amount over 1.35 percent. The Senate bill contained no
similar provision. The conference report does not contain the House
provision. Instead, the conference report requires the Secretary to
refund all of the unearned premiums.

Limitation on secondary residences

The House amendment contained a provision which generally would prohibit
the Secretary from insuring mortgages on secondary residences and
included an exception that determines such a residence would be
necessary to avoid undue hardship. For example, seasonal employment in
differing locales may necessitate the mortgagor living in the second
home for at least part of the year. The Senate bill contained no similar
provision. The conference report adopted the House provision. In no
instance will FHA be allowed to insure mortgages on vacation homes. This
change would only apply to (1) mortgages insured pursuant to a
conditional commitment issued after 60 days following the date of
enactment or in accordance with the direct endorsement program, if the
approved underwriter of the mortgagee signs the appraisal report for the
property on or after the date of the enactment; and (2) the approval of
substitute mortgagors, if the original mortgagor was subject to such
amendments. Any mortgage executed prior to the enactment of these
amendments would continue to be governed under provisions as existed
before the enactment of this provision. The Secretary can continue to
insure mortgages under existing law until 60 days after the enactment
of this statute.

Mortgage Counseling: The House amendment contained a provision not
included in the Senate bill that permits FHA MMI Funds to be used to
provide mortgage counseling to delinquent mortgagors with FHA insured
mortgages. The conference report contains the House provision. The
conferees recognize the importance and the value of providing mortgage
counseling services to delinquent homeowners, especially those
homeowners who find themselves faced with a temporary loss of income.
The conferees believe that, in order to be a candidate for counseling
services, the cost of which would be covered by the MMIF, the default
must have been caused by circumstances beyond the mortgagor's control
and/or, there must be a reasonable prospect that the mortgagor will be
able to resume full mortgage payments after a temporary period of
reduced or suspended payments. Given the financial condition of FHA's
MMIF, the conferees intend that the Secretary establish criteria for the
use of MMIF funds and for the selection of applicants for counseling
services. The conferees direct the Secretary to take appropriate steps
to reduce losses due to foreclosure by securing the services of
experienced HUD approved nonprofit counseling agencies. Agencies
selected should be those with a successful track record in delinquent
mortgage counseling and those who operate in several states and
locations either directly or through sub-contracting relationships. This
coordination of counseling services will help insure quality controls
as well as positioning these services to be more fully used by the
mortgage industry which increasingly is more regional and national in
scope.

Delegated processing: The Senate bill contained a provision that
required the Secretary to implement a delegated multifamily insured
mortgage processing system for mortgages insured pursuant to Sections
221, 223, 232, and 241 of the National Housing Act under which the
Secretary retains authority to approve rents, expenses, property
appraisals, and mortgage amounts and to execute a firm commitment. The
House amendment contained a similar provision but also included Section
207 of the National Housing Act. The conference report contains the
Senate provision with an amendment to include Section 207.

Disclosure regarding interest due upon mortgage prepayment: The House
amendment contained a provision not included in the Senate bill that
requires each mortgagee to provide written notice to mortgagors, both
annually and at the time of the mortgage, of possible interest liability
upon prepayment. This applies to insured FHA mortgages outstanding 90
days after the effective date of regulations. The conference report
contains the House provision.

Neighborhood accountability: The House amendment contained a provision
not included in the Senate bill that would prohibit any FHA mortgagee
from varying mortgage interest rates, the level of discount points, loan
origination fees or any other amount charged on the basis of the loan
amount in the area.

The House provision would require the Secretary to assess the
performance of the mortgagee in meeting the lending needs of the
community, the consistency of the lending practices with safe and sound
lending practices, and the mortgagee's record of FHA insured defaults.
Such information would be considered by the Secretary in determining
whether the mortgagee can continue to participate in the FHA insurance
program. Should a mortgagee fail to meet the lending needs of the
community, the Secretary would require the mortgagee to take steps to
remedy the omission. Such steps would include filing a plan to remedy
such deficiencies. Such plan would be developed through a public notice
and comment process. If a mortgagee fails to comply with its plan, the
Secretary could withdraw approval of the mortgagee for participation in
the FHA program. The Secretary would report to Congress annually on
actions taken to carry out these provisions.

The conference report contains the House provision with an amendment to
permit an exception not to exceed 2 percent variation in the amounts
changed for fees and discount points based upon the loan amount and
makes conforming changes consistent with the HUD Reform Act of 1989.
This section is intended to apply to Sec. 203 of the National Housing
Act by loan type. For example, mortgages insured under the 203(k)
program may be priced differently from mortgages insured under the
203(b) program. The Committee recognizes that different types of
mortgages involve differing levels of risk, processing expenses or other
factors that differentiate them and necessitate pricing variations.
Mortgages are subject to uniform pricing requirements of loans of
varying amount but insured under the same subsection.

Acturial soundness: The House amendment contained a provision that would
require the Secretary to ensure that the MMI Fund attain a capital ratio
of 1.25% within 24 months of enactment and 2% within 10 years. The
Senate bill contained a similar provision except it would provide 18
months to attain 1.25%, and stated that the Secretary should endeavor
to ensure that the fund attain a 2% capital ratio within 10 years. The
conference report contains the House provision regarding the 1.25%
capital ratio and the Senate provision regarding the 2% capital ratio.

Reports: The House amendment contained a provision that would require
the Secretary to submit an annual report to Congress describing the
actions the Secretary will take to ensure that the MMI Fund attains the
required capital ratio. The Secretary would be required to annually
conduct an independent actuarial study of the MMI Fund and report
annually to Congress on the status of the Fund. The Senate bill
contained a provision that would require the Secretary to report to
Congress annually on the status of the Fund should the Fund fail to
achieve the 1.25% capital ratio. Three years after enactment the
Secretary would be required to begin reporting annually on the status
of the Fund and on efforts to achieve the 2% goal. The conference report
contains the House provision.

Operational goals: The House amendment contained a provision that would
define the operational goals of the MMI Fund. The Senate bill contained
a similar provision that would define the principles of operation.

The first goal of the House provision would be to maintain an adequate
capital ratio. The Senate provision was similar except it specifies a
capital ratio of 1.25% to be achieved in 18 months and 2% thereafter.
The conference report contains the House provision.

The second goal of the House provision would be to meet the needs of
homebuyers with low downpayments and first-time homebuyers by providing
access to mortgage credit. The Senate provision is the same except it
does not include meeting needs of homebuyers with low down payments. The
conference report contains the House provision.

The third goal of the House provision would be to minimize the risk to
the Fund and to homeowners from homeowner default. The Senate bill
contained a similar provision. The conference report contains the House
provision.

The Senate bill contains an additional principle of operation that was
not included in the House amendment to avoid the problems of adverse
selection by establishing premiums related to the probability of
homeowner default. The conference report contains the Senate provision
amended to state the operational goal as avoiding adverse selection. The
conference report establishes periodic annual premiums that vary
depending on the probability of homeowner default. The conferees believe
that a risk-based premium is necessary to meet the four operational
goals of the MMI Fund.

The House amendment contained a provision that would give the Secretary
the authority, upon a determination of an independent actuarial study,
to propose and implement any adjustments to the insurance premiums or
any other program requirements to achieve actuarial soundness. The
Senate bill contained a similar provision. The conference report
contains the House provision with an amendment to delete the reference
to other program requirements.

Distributive Shares: The House amendment contained a provision that
stated if, pursuant to the independent annual actuarial study, the
Secretary determines the MMI Fund is not meeting its operational goals,
the Secretary cannot issue distributions, and may by regulation, propose
and implement any adjustments to the insurance premiums established by
the Secretary to achieve such goals. The Senate bill contained a similar
provision. The conference report contains the House provision.

The House amendment contained a provision not included in the Senate
bill to authorize the Secretary to require payment on all mortgages that
are obligations of the MMI Fund of an additional premium charge as
detemined by the Secretary to be consistent with sound actuarial
practice. The conference report does not contain the House provision.

Mortgage Insurance in Virgin Islands: The House amendment contained a
provision not included in the Senate bill that adds the Virgin Islands
as a super high cost area for FHA insurance purposes. Current law
permits the Secretary to authorize FHA mortgages beyond the $124,785
ceiling for Alaska, Hawaii, and Guam. The conference report contains the
House provision.

221(g)(4) assignments:  The House amendment contained a provision not
included in the Senate bill that would provide that in connection with
mortgages insured under Section 221 of the National Housing Act, the
Secretary shall provide, to mortgagees who agree not to exercise their
option to assign their mortgages to HUD, an incentive payment from the
General Insurance Fund to the mortgagee in an amount equal to the
present value at the time of assignment of the difference between the
mortgage interest rate and the rate on similiar mortgages in lieu of the
issuance of debentures on the assignment of such mortgages as required
by current law.  The conference report contains the House provision
amended to provide that the Secretary shall arrange for the sale of
beneficial interests in the mortgage loan through an auction and sale of
the mortgage loans or participation certificates or other
mortgage-backed obligations in a form acceptable to the Secretary and
that a mortgagee who elects to assign a mortgage must provide the
Secretary and persons bidding at the auction a description of the
characteristics of the original credit instrument and mortgage securing
the original credit instrument (including principal mortgage balance,
original stated interest rate, service fees, real estate and tenant
charactistics, the level and duration of Federal subsidies and any other
information determined by the Secretary to be appropriate.  The
Secretary is required in any auction to accept the lowest interest rate
bid for purchase that the Secretary detemines to be acceptable.  The
Secretary shall provide a monthly interest subsidy payment from the
General Insurance Fund to the purchaser of the original credit
instrument and the mortgage securing such credit instrument (and its
assigns who are approved mortgagees) in an amount equal to the
difference between the stated interest due on the mortgage loan and the
lowest rate necessary to accomplish a sale of the participation
certificates for the then unpaid principal balance plus accured interest
at a rate to be determined by the Secretary.  The conferees recognize
that, during the auction period, the mortgagee will not be accuring
interest at the rate or rates applicable under the current assignment
process.  The conferees intend that the mortgagee would not be deprived
of any economic benefits that the mortgagee would have recieved had the
mortgage been assigned to HUD under the current assignment process.
These economic benefits include interest to accrue at a rate or rates
consistent with the rate of interest a mortgagee would have received
under the current assignment process and the Secretary's past
interpretation of section 221(g)(4).

If no bids are received, the bids received are not acceptable to the
Secretary, or settlement does not occur within 30-90 days, the mortgagee
would retain all rights to assign the mortgage loan to the Secretary,
including the right to interest for the period covering the auction
process at a rate to be determined by the Secretary. The conferees
intend that, if the auction is not consummated and the mortgage is
assigned to HUD, the mortgagee would not be deprived of any economic
benefits that the mortgagee would have received had the mortgage been
assigned to HUD under the current assignment process. These economic
benefits include interest to accrue at a rate or rates consistent with
the rate of interest a mortgagee would have received under the current
assignment process and the Secretary's past interpretation of this
statute.

Report on FHA defaults: The House amendment contained a provision not
included in the Senate bill that would require the Secretary to publish
quarterly reports of early defaults and foreclosures on FHA-insured
housing. Each report would contain for each lender originating
single-family insured mortgages in a designated census tract (1) the
name of lenders and the number of each census tract in which the lender
originated one or more loans; (2) the total number of such mortgages
originated by each such lender in each census tract; (3) the total
number of defaults and foreclosures during the specified reporting
period by census tract; (4) for each census tract, the percentage of
each lender's total insured mortgages on which defaults or foreclosures
have ocurred during the applicable reporting period; (5) the total of
all such originations, defaults, and foreclosures on insured mortgages
originated by each such lender during the reporting period for all
census tracts and the percentage of the total number of such lender's
insured mortgages on which defaults or foreclosures have occurred. It
would also required data (1) for each lender, the total number of
insured mortgages originated by the lender secured by properties not
located in a designated census tract, the total number of defaults and
foreclosures on such mortgages and the percentages of such mortgages
originated on which defaults or foreclosures occurred; and (2) for each
census tract, the total number of mortgages originated during the
applicable reporting period, the number of defaults and foreclosures and
the percentage of the total insured originations on which defaults or
foreclosures occurred. Until the first report under this section is
published, the Secretary would have to make publicly available all
reports regarding "Default/Claims Rates per Regional Office for FY 90
Endorsements" produced by HUD.

The conference report contains the House provision with an amendment to
require that information be kept by HUD in a data bank made available
to the public and that HUD issue an annual report, instead of a
quarterly report, containing the data from the data bank. To minimize
bureaucracy, costs, and paperwork, the Committee has reduced HUD's
reporting requirement from quarterly to annually. The Committee still
intends that the information in the data bank will be updated on a
quarterly basis and be publicly accessible upon demand.

Home Equity Conversion Mortgages: The House amendment contained a
provision to extend the reverse mortgage program until September 30,
1994, and requires disclosure of the extent of the liability of the
homeowner under the mortgage and the projected total future loan
balances for at least 2 projected loan terms which shall include the
costs for a short-term mortgage and the costs for a long-term mortgage
equaling the life expectancy of the borrower and the cost of the
mortgage. The Senate bill contained a similar provision except it only
extended the program until 1993 and contained similar disclosure
requirements. The conference report contains the House provision with
an amendment to extend the program through fiscal year 1995.

Disapproval of property disposition regulations: The House amendment
contained a provision not included in the Senate bill to permit homeless
assistance providers to obtain HUD-held property for use under the $1
lease program without a 30-day waiting period by disapproving Section
291.1(c)(2) of the interim rule of HUD entitled "Disposition of
HUD-Acquired Single Family Property" (55 Fed Reg. 1161 et seq.). It
prohibited the Secretary from publishing a final rule containing or
based on such provision. The conference report contains the House
provision. The conferees intend that HUD is prohibited from publishing
a final rule containing or based upon such restrictions which will
inhibit the transfer of eligible FHA property for homeless assistance.

Report on Foreclosed Properties: The Senate bill contained a provision
not included in the House amendment that would require HUD to submit a
report to Congress containing strategies and action plans to assist in
the disposition of HUD foreclosed properties giving special emphasis to
properties within the HUD inventory for over one year. The conference
report contains the Senate provision.

GNMA guarantees: The House amendment contained a provision not included
in the Senate bill that would limit aggregate GNMA mortgage-backed
security (MBS) guarantee authority to $84,982,040,000 for FY 1991 and
to $88,296,339,000 for FY 1992. The conference report contains the House
provision with an amendment to limit GNMA MBS authority to
$84,982,000,000 for FY 1991 nd $88,296,000,000 for FY 1992.

Loan limits for property insurance loans: The House amendment contained
a provision not included in the Senate bill that would increase the loan
limits for property improvement insurance to $30,000 for single family
structures, and $75,000, or a maximum average of $15,000 per unit, for
the improvement or conversions of an existing structure to rental use.
Would increase loan term units for single family improvement loans and
conversion loans to 20 years and 32 days and maintains the loan term for
manufactured home improvement and conversion loans at 15 years 32 days.
Also would expand the loan term for improvement and conversion loans for
an apartment house or dwelling used by two or more families to 20 years
32 days. The conference report contains the House provision with an
amendment (1) that the loan limits will not be increased before the
release by HUD of a report on need to raise the limit to be complete by
June 1, 1991; (2) to increase loan limits to $25,000 for single family
homes and to $60,000 for multifamily or a maximum of $12,000 per unit;
(3) to have changes go into effect on June 1, 1990, and (4) to make no
high cost area adjustments except that the Secretary is given the
discretion to raise limits for high cost areas.

Sec. 235 homeownership: The House amendment contained a provision not
included in the Senate bill that would extend Section 235 homeownership
assistance payments authority, insurance authority, and housing stimulus
authority until September 30, 1991, and removes Section 235 program
sunset. The conference report does not contain the House provision.

Sense of Senate provision: The Senate bill contained two Sense of the
Senate resolutions not included in the House bill. One was that the
Secretary had sufficient authority to redefine the term "area" under
Section 203 of the National Housing Act in designating areas where FHA
mortgage insurance is not accessible for a significant number of
homebuyers because of diverse economies. The second was that Individual
Retirement Accounts should be able to be withdrawn without penalty for
the purpose of a first-time home purchase, and that appropriate changes
in law should be considered as part of tax legislation during this
session of Congress. The conference report does not contain either
Senate resolution.