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                                                      PRINTER'S NO. 2041



No. 1401 Session of 2008

           AND A. WILLIAMS, MAY 12, 2008


                                     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," establishing

     1     a foreclosure prevention program; and making an
     2     appropriation.

     3     The General Assembly of the Commonwealth of Pennsylvania
     4  hereby enacts as follows:
     5     Section 1.  The act of December 3, 1959 (P.L.1688, No.621),
     6  known as the Housing Finance Agency Law, is amended by adding an
     7  article to read:
     8                            ARTICLE IV-D
    10  Section 401-D.  Definitions.
    11     The following words and phrases when used in this article
    12  shall have the meanings given to them in this section unless the
    13  context clearly indicates otherwise:
    14     "Foreclosure Prevention Fund."  The fund created by the
    15  agency to make grants to qualified homeowners in accordance with
    16  the provisions of this article.
    17  Section 402-D.  Home Mortgage Foreclosure Prevention Program.
    18     (a)  Purpose.--The Home Mortgage Foreclosure Prevention
    19  Program is hereby established to enable eligible homeowners to
    20  remove themselves from unaffordable mortgage situations by
    21  either refinancing their mortgage debt with a new mortgage
    22  financed by the agency or arranging an alternative mortgage
    23  repayment plan with the assistance of the agency.
    24     (b)  Refinancing assistance grants.--The agency is authorized
    25  to use funds appropriated for the purposes set forth in this
    26  article to make grants of up to $2,500 to help defray the
    27  closing costs associated with refinancing a high or adjustable
    28  rate mortgage to a new fixed rate mortgage that is affordable to
    29  the homeowner.
    30     (c)  Eligibility requirements.--The following eligibility

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     1  requirements must be met by an applicant in order to be approved
     2  by the agency to participate in the program created in this
     3  article:
     4         (1)  The applicant's current annual household income must
     5     not exceed the income limits of the agency's Keystone Home
     6     Loan Program.
     7         (2)  The home must be located in this Commonwealth and be
     8     a one-family or two-family, owner-occupied structure and the
     9     domicile of the applicants defined in section 13 of the act
    10     of December 31, 1965 (P.L.1257, No.511), known as the Local
    11     Tax Enabling Act.
    12         (3)  The loan being refinanced or which is being assisted
    13     must not have been incurred primarily for business or
    14     commercial purposes.
    15  Section 403-D.  Agency guidelines.
    16     The agency shall publish guidelines in the Pennsylvania
    17  Bulletin to administer the provisions of this article within 90
    18  days of the effective date of this section.
    19  Section 404-D.  Appropriation.
    20     The following shall apply:
    21         (1)  The sum of $10,000,000 is hereby appropriated to the
    22     Pennsylvania Housing Finance Agency from the General Fund for
    23     the purposes set forth in this article. A portion of the
    24     funds appropriated may be used to pay the costs of the
    25     administration of this article, not to exceed 5% of the total
    26     amount appropriated.
    27         (2)  Any appropriated funds under paragraph (1) not
    28     pledged or expended in accordance with this act by January 1,
    29     2010, shall be transferred to the Pennsylvania Housing
    30     Affordability and Rehabilitation Enhancement Program.
    20080S1401B2041                  - 3 -     

     1     Section 2.  This act shall take effect immediately.

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