12 USC 4601 - Review of underwriting guidelines

U.S Code last checked for updates: May 18, 2024

§ 4601.

Review of underwriting guidelines

(a)

Study

Each of the enterprises shall conduct a study to review the underwriting guidelines of the enterprise. The studies shall examine—

(1)

the extent to which the underwriting guidelines prevent or inhibit the purchase or securitization of mortgages for housing located in mixed-use, urban center, and predominantly minority neighborhoods and for housing for low- and moderate-income families;

(2)

the standards employed by private mortgage insurers and the extent to which such standards inhibit the purchase and securitization by the enterprises of mortgages described in paragraph (1); and

(3)

the implications of implementing underwriting standards that—

(A)

establish a downpayment requirement for mortgagors of 5 percent or less;

(B)

allow the use of cash on hand as a source for downpayments; and

(C)

approve borrowers who have a credit history of delinquencies if the borrower can demonstrate a satisfactory credit history for at least the 12-month period ending on the date of the application for the mortgage.

(b)

Report

(Pub. L. 102–550, title XIII, § 1354, Oct. 28, 1992, 106 Stat. 3970.)

cite as: 12 USC 4601