h r 6460 the transparency and security mortgage registration act of 2010
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8/8/2019 H R 6460 the Transparency and Security Mortgage Registration Act of 2010
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(Original Signature of Member)
111TH CONGRESS2D SESSION H. R. ll
To prohibit Fannie Mae, Freddie Mac, and Ginnie Mae from owning or
guaranteeing any mortgage that is assigned to the Mortgage Electronic
Registration Systems or for which MERS is the mortgagee of record.
IN THE HOUSE OF REPRESENTATIVES
Ms. K APTUR introduced the following bill; which was referred to the
Committee on llllllllllllll
A BILL To prohibit Fannie Mae, Freddie Mac, and Ginnie Mae from
owning or guaranteeing any mortgage that is assigned
to the Mortgage Electronic Registration Systems or for
which MERS is the mortgagee of record.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled,2
SECTION 1. SHORT TITLE.3
This Act may be cited as the ‘‘Transparency and Se-4
curity in Mortgage Registration Act of 2010’’.5
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SEC. 2. PROHIBITION ON GUARANTEEING MERS MORT-1
GAGES.2
(a) F ANNIE M AE AND FREDDIE M AC.—3
(1) F ANNIE MAE.—Section 302(b) of the Na-4
tional Housing Act (12 U.S.C. 1717(b)) is amended5
by adding at the end the following new paragraph:6
‘‘(6)(A) After the date of the enactment of the Trans-7
parency and Security in Mortgage Registration Act of 8
2010, the corporation may not purchase, acquire, newly 9
lend on the security of, newly invest in securities con-10
sisting of, or otherwise newly deal in any MERS mortgage11
or mortgages.12
‘‘(B) After the expiration of the period under sub-13
paragraph (C), MERS shall not be the named mortgagee14
or mortgagee of record on any mortgage owned, guaran-15
teed, or securitized by the corporation. Not later than the16
expiration of such period, the corporation shall require17
that all mortgage loans owned, guaranteed, or securitized18
at such time by the corporation and on which MERS is19
the named mortgagee or mortgagee of record shall be as-20
signed to the servicer, holder, or creditor, as defined by 21
the guidelines of the corporation. The corporation shall22
not reimburse the servicer, holder, or creditor for any ex-23
pense incurred in the carrying out or recording such an24
assignment.25
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‘‘(C)(i) Except as provided in clause (ii), the period1
under this subparagraph is the 6-month period beginning2
on the date of the enactment of the Transparency and Se-3
curity in Mortgage Registration Act of 2010.4
‘‘(ii) In the case of any mortgage owned, guaranteed,5
or securitized by the corporation for which the servicer,6
holder, or creditor has demonstrated to the corporation,7
in accordance with standards established by the Director8
of the Federal Housing Finance Agency, that compliance9
with subparagraph (B) by the expiration of such 6-month10
period will cause a severe threat to the continued financial11
viability of such entity, the period under this subpara-12
graph shall be the period that begins on such date of en-13
actment and has such duration as determined by the cor-14
poration, in accordance with standards established by the15
Director, but in no case has a duration longer than 1216
months.17
‘‘(D) Not later than the expiration of the 6-month18
period referred to in subparagraph (C)(i), the corporation19
shall submit a report detailing its compliance with sub-20
paragraph (B) to the Congress, the Director of the Fed-21
eral Housing Finance Agency, the Financial Stability 22
Oversight Council, and the Director of the Bureau of Con-23
sumer Financial Protection of the Federal Reserve Sys-24
tem, which shall describe any extensions of the period for25
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compliance with subparagraph (B) granted pursuant to1
subparagraph (C).2
‘‘(E) For purposes of this paragraph, the following3
definitions shall apply:4
‘‘(i) The term ‘MERS’ means the Mortgage5
Electronic Registration Systems, Inc., or any suc-6
cessor entity of such corporation.7
‘‘(ii) The term ‘MERS mortgage’ means any 8
mortgage—9
‘‘(I) for which the MERS is, or was at any 10
time, the original or nominal mortgagee or11
mortgagee of record under the mortgage;12
‘‘(II) that is, or was at any time, assigned13
to or recorded in the MERS; or14
‘‘(III) for which the MERS is, or was at15
any time, acting as nominee in the county land16
records for the lender or servicer of the mort-17
gage.’’.18
(2) FREDDIE MAC.—Section 305(a) of the Fed-19
eral Home Loan Mortgage Corporation Act (1220
U.S.C. 1454(a)) is amended by adding at the end21
the following new paragraph:22
‘‘(6)(A) After the date of the enactment of the Trans-23
parency and Security in Mortgage Registration Act of 24
2010, the Corporation may not purchase, acquire, newly 25
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lend on the security of, newly invest in securities con-1
sisting of, or otherwise newly deal in any MERS mortgage2
or mortgages.3
‘‘(B) After the expiration of the period under sub-4
paragraph (C), MERS shall not be the named mortgagee5
or mortgagee of record on any mortgage owned, guaran-6
teed, or securitized by the Corporation. Not later than the7
expiration of such period, the Corporation shall require8
that all mortgage loans owned, guaranteed, or securitized9
at such time by the Corporation and on which MERS is10
the named mortgagee or mortgagee of record shall be as-11
signed to the servicer, holder, or creditor, as defined by 12
the guidelines of the Corporation. The Corporation shall13
not reimburse the servicer, holder, or creditor for any ex-14
pense incurred in the carrying out or recording such an15
assignment.16
‘‘(C) ( i) Except as provided in clause (ii), the period17
under this subparagraph is the 6-month period beginning18
on the date of the enactment of the Transparency and Se-19
curity in Mortgage Registration Act of 2010.20
‘‘(ii) In the case of any mortgage owned, guaranteed,21
or securitized by the Corporation for which the servicer,22
holder, or creditor has demonstrated to the Corporation,23
in accordance with standards established by the Director24
of the Federal Housing Finance Agency, that compliance25
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with subparagraph (B) by the expiration of such 6-month1
period will cause a severe threat to the continued financial2
viability of such entity, the period under this subpara-3
graph shall be the period that begins on such date of en-4
actment and has such duration as determined by the Cor-5
poration, in accordance with standards established by the6
Director, but in no case has a duration longer than 127
months.8
‘‘(D) Not later than the expiration of the 6-month9
period referred to in subparagraph (C)(i), the Corporation10
shall submit a report detailing its compliance with sub-11
paragraph (B) to the Congress, the Director of the Fed-12
eral Housing Finance Agency, the Financial Stability 13
Oversight Council, and the Director of the Bureau of Con-14
sumer Financial Protection of the Federal Reserve Sys-15
tem, which shall describe any extensions of the period for16
compliance with subparagraph (B) granted pursuant to17
subparagraph (C).18
‘‘(E) For purposes of this paragraph, the following19
definitions shall apply:20
‘‘(i) The term ‘MERS’ means the Mortgage21
Electronic Registration Systems, Inc., or any suc-22
cessor entity of such corporation.23
‘‘(ii) The term ‘MERS mortgage’ means any 24
mortgage—25
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‘‘(I) for which the MERS is, or was at any 1
time, the original or nominal mortgagee or2
mortgagee of record under the mortgage;3
‘‘(II) that is, or was at any time, assigned4
to or recorded in the MERS; or5
‘‘(III) for which the MERS is, or was at6
any time, acting as nominee in the county land7
records for the lender or servicer of the mort-8
gage.’’.9
(3) REGULATIONS.—Not later than the expira-10
tion of the 90-day period beginning on the date of 11
the enactment of this Act, the Director of the Fed-12
eral Housing Finance Agency shall issue any regula-13
tions necessary to carry out the amendments made14
by paragraphs (1) and (2). In issuing such regula-15
tions, the Director shall consult and coordinate with16
the Secretary of Housing and Urban Development to17
ensure that the regulations issued by the Director18
and the regulations issued by the Secretary pursuant19
to subsection (b)(2) of this section are uniform and20
consistent to maximum extent possible.21
(b) GINNIE M AE.—22
(1) PROHIBITION.—Section 302(c) of the Na-23
tional Housing Act (12 U.S.C. 1717(c)) is amended24
by adding at the end the following new paragraph:25
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‘‘(6)(A) After the date of the enactment of the Trans-1
parency and Security in Mortgage Registration Act of 2
2010, the Association may not newly guarantee the pay-3
ment of principal of or interest on any trust certificate4
or other security based or backed by a trust or pool that5
contains, or purchase or acquire, any MERS mortgage.6
‘‘(B)(i) After the expiration of the period under sub-7
paragraph (C), MERS shall not be the named mortgagee8
or mortgagee of record on any mortgage owned or held9
by the Association or on any mortgage contained in a pool10
backing or on which is based any trust certificate or other11
security the payment of principal of or interest on which12
is guaranteed by the Association.13
‘‘(ii) Not later than the expiration of such period, the14
Association shall require that all mortgage loans that are15
owned or held at such time by the Association, or that16
at such time are contained in a trust or pool backing or17
on which is based a trust certificate or other security the18
payment of principal of or interest on which is guaranteed19
by the Association, and on which MERS is the named20
mortgagee or mortgagee of record, shall be assigned to21
the servicer, holder, or creditor, as defined by the guide-22
lines of the Association. The Association shall not reim-23
burse the servicer, holder, or creditor for any expense in-24
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curred in the carrying out or recording such an assign-1
ment.2
‘‘(C)(i) Except as provided in clause (ii), the period3
under this subparagraph is the 6-month period beginning4
on the date of the enactment of the Transparency and Se-5
curity in Mortgage Registration Act of 2010.6
‘‘(ii) In the case of any mortgage owned or held by 7
the Association, or contained in a trust or pool backing8
or on which is based a trust certificate or other security 9
the payment of principal of or interest on which is guaran-10
teed by the Association, for which the servicer, holder, or11
creditor has demonstrated to the Association, in accord-12
ance with standards established by the Secretary, that13
compliance with subparagraph (B) by the expiration of 14
such 6-month period will cause a severe threat to the con-15
tinued financial viability of such entity, the period under16
this subparagraph shall be the period that begins on such17
date of enactment and has such duration as determined18
by the Association, in accordance with standards estab-19
lished by the Secretary, but in no case has a duration20
longer than 12 months.21
‘‘(D) Not later than the expiration of the 6-month22
period described in subparagraph (C)(i), the Association23
submit a report detailing its compliance with subpara-24
graph (B) to the Congress, the Secretary, the Financial25
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necessary to carry out the amendments made by 1
paragraphs (1) and (2). In issuing such regulations,2
the Secretary shall consult and coordinate with the3
Director of the Federal Housing Finance Agency to4
ensure that the regulations issued by the Secretary 5
and the regulations issued by the Director pursuant6
to subsection (a)(3) of this section are uniform and7
consistent to maximum extent possible8
SEC. 3. HUD STUDY.9
(a) STUDY.—The Secretary of Housing and Urban10
Development, in consultation with the Comptroller Gen-11
eral of the United States, shall conduct a study to analyze12
and determine—13
(1) the impacts of the lack of electronic records14
and uniform standards found in local land title rec-15
ordation systems currently used in the various16
States;17
(2) any progress States have made in devel-18
oping electronic land title recordation systems for19
their localities that contain uniform standards, and20
any findings and conclusions and best practices re-21
sulting from such development;22
(3) the current oversight role of the Federal23
Government in the transfer and recordation of land24
titles;25
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(4) opportunities, and the feasibility of such op-1
portunities, that may be present to leverage progress2
made by some States and localities to create an elec-3
tronic land title recordation system, including4
through—5
(A) a system that would maintain all pre-6
vious records of the land-property without in-7
validating, interfering with, or preempting State8
real property law governing the transfer and9
perfection of land title; and10
(B) further actions by the States or by the11
Federal Government, or coordinated actions of 12
both; and13
(5) the feasibility of creating a Federal land14
title recordation system for property transfers that15
would maintain all previous records of the land-prop-16
erty without invalidating, interfering with, or pre-17
empting State real property law governing the trans-18
fer and perfection of land title.19
(b) REPORT.—Not later than the expiration of the20
12-month period beginning on the date of the enactment21
of this Act, the Secretary of Housing and Urban Develop-22
ment, in consultation with the Comptroller General of the23
United States, shall submit to the Congress a report on24
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the results and findings of the study conducted under this1
section.2
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