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                                                        PRINTER'S NO. 64



No. 39 Session of 2007



                                     AN ACT

     1  Amending the act of December 3, 1959 (P.L.1688, No.621),
     2     entitled, as amended, "An act to promote the health, safety
     3     and welfare of the people of the Commonwealth by broadening
     4     the market for housing for persons and families of low and
     5     moderate income and alleviating shortages thereof, and by
     6     assisting in the provision of housing for elderly persons
     7     through the creation of the Pennsylvania Housing Finance
     8     Agency as a public corporation and government
     9     instrumentality; providing for the organization, membership
    10     and administration of the agency, prescribing its general
    11     powers and duties and the manner in which its funds are kept
    12     and audited, empowering the agency to make housing loans to
    13     qualified mortgagors upon the security of insured and
    14     uninsured mortgages, defining qualified mortgagors and
    15     providing for priorities among tenants in certain instances,
    16     prescribing interest rates and other terms of housing loans,
    17     permitting the agency to acquire real or personal property,
    18     permitting the agency to make agreements with financial
    19     institutions and Federal agencies, providing for the purchase
    20     by persons of low and moderate income of housing units, and
    21     approving the sale of housing units, permitting the agency to
    22     sell housing loans, providing for the promulgation of
    23     regulations and forms by the agency, prescribing penalties
    24     for furnishing false information, empowering the agency to
    25     borrow money upon its own credit by the issuance and sale of
    26     bonds and notes and by giving security therefor, permitting
    27     the refunding, redemption and purchase of such obligations by
    28     the agency, prescribing remedies of holders of such bonds and
    29     notes, exempting bonds and notes of the agency, the income
    30     therefrom, and the income and revenues of the agency from
    31     taxation, except transfer, death and gift taxes; making such
    32     bonds and notes legal investments for certain purposes; and
    33     indicating how the act shall become effective," further

     1     providing for the Homeowner's Emergency Assistance Program;
     2     and providing for biennial foreclosure study.

     3     The General Assembly of the Commonwealth of Pennsylvania
     4  hereby enacts as follows:
     5     Section 1.  Section 401-C(a)(3) of the act of December 3,
     6  1959 (P.L.1688, No.621), known as the Housing Finance Agency
     7  Law, is repealed except as it pertains to mortgages insured by
     8  the Federal Housing Finance Administration under Title II of the
     9  National Housing Act (48 Stat. 1246, 12 U.S.C. 1707-1715z-18).
    10     Section 2.  Section 403-C(b) of the act is amended by adding
    11  a paragraph to read:
    12     Section 403-C.  Notice Requirements.--* * *
    13     (b)  * * *
    14     (7)  An application for mortgage assistance may be submitted
    15  to the agency beyond the 30-day period specified in paragraph
    16  (5), and, in such a case, the agency shall make a determination
    17  within sixty (60) calendar days of receipt of the mortgagor's
    18  application. Such a late application will not stay any
    19  foreclosure proceeding, but, in the event the application is
    20  approved, any such foreclosure proceeding shall be stayed.
    21     Section 3.  Section 405-C of the act is amended by adding a
    22  subsection to read:
    23     Section 405-C.  Assistance Payments.--* * *
    24     (b.1)  In lieu of paying arrears under subsection (a) or
    25  ongoing assistance under subsection (b), the agency may fund a
    26  compromise payoff of the balance of the mortgage, if the agency
    27  in its sole discretion determines that structuring assistance in
    28  such a manner would be in the best interest of the agency and
    29  the mortgagor.
    30     Section 4.  Section 406-C(5) of the act is amended to read:

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     1     Section 406-C.  Repayment.--Upon approval of mortgage
     2  assistance, the agency shall enter into an agreement with the
     3  mortgagor for repayment of all mortgage assistance made by the
     4  agency plus interest as provided in paragraph (5). The agreement
     5  shall provide for monthly payments by the mortgagor and be
     6  subject to the following provisions:
     7     * * *
     8     (5)  Interest shall accrue on all mortgage assistance made by
     9  the agency at the rate [of nine (9) percent per annum.]
    10  established by the Secretary of Banking as the maximum lawful
    11  rate of interest for residential mortgages, pursuant to the
    12  authority granted under the act of January 30, 1974 (P.L.13,
    13  No.6), referred to as the Loan Interest and Protection Law, for
    14  the month preceding the date that interest starts to accrue.
    15  Interest shall start to accrue whenever the mortgagor begins to
    16  make repayment under this section. Interest shall accrue only
    17  during the period in which the mortgagor is required to make
    18  repayment under this section. When any mortgage for which
    19  mortgage assistance was made is paid, interest shall then accrue
    20  on all mortgage assistance due and owing at the same rate and on
    21  the same basis as the mortgage for which the mortgage assistance
    22  was made.
    23     * * *
    24     Section 5.  The act is amended by adding a section to read:
    25     Section 412-C.  Biennial Foreclosure Study.--Two (2) years
    26  following the effective date of this section, and every two (2)
    27  years thereafter, the agency shall conduct a study of
    28  foreclosures in this Commonwealth, using data accumulated from
    29  applications for assistance under this article and including
    30  recommendations for addressing any problems identified in the
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     1  study.
     2     Section 6.  This act shall take effect immediately.

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