See Lee of New York motion to recommit with instructions for explanation.

1. Adds SEC. 16. PROHIBITION OF MORTGAGE INSURANCE FOR BORROWERS WITH STRATEGIC DEFAULTS at the end of the bill

   Adds a section

   Inserted: SEC. 16. PROHIBITION OF MORTGAGE INSURANCE FOR BORROWERS WITH STRATEGIC DEFAULTS.

   Inserted: Section 203 of the National Housing Act (12 U.S.C. 1709), as amended by the preceding provisions of this Act, is further amended by adding at the end the following new subsection:

   Inserted: "(z) Prohibition of Mortgage Insurance for Borrowers With Strategic Defaults.--

   Inserted: "(1) Prohibition.--The Secretary may not newly insure any mortgage under this title that is secured by a 1- to 4-family dwelling unless the mortgagee has determined, in accordance with such standards and requirements established by the Secretary, that the mortgagor under such mortgage has not previously engaged in any strategic default with respect to any residential mortgage loan.

   Inserted: "(2) Strategic default.--For purposes of this subsection, the term 'strategic default' means, with respect to a residential mortgage loan, an intentional default having such characteristics or under such circumstances as the Secretary shall, by regulation, provide.".

   Inserted: SEC. 17. PROHIBITION ON TAXPAYER BAILOUT OF FHA PROGRAM.

   Inserted: Section 205 of the National Housing Act (12 U.S.C. 1711), as amended by the preceding provisions of this Act, is further amended by adding at the end the following new subsection:

   Inserted: "(h) Taxpayer Protection.--The Secretary shall use all available actions and methods authorized under law to ensure compliance with subsection (f)(2) and to protect the taxpayers of the United States from financial responsibility for any obligations of the Fund, including authority to increase insurance premiums charged under this title for mortgages that are obligations of the Fund, authority to establish more stringent underwriting standards for such mortgages, and authority to increase the amount of cash or its equivalent required to be paid on account of the property subject to such a mortgage.".

   Original wording

   At the end of the bill, add the following new sections:

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As printed