SEC-330 -- ACCOUNTABILITY OF MORTGAGE LENDERS.


 (a) Limitation on Tiered Pricing Practices.-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:

 "(t)(1) No mortgagee may make or hold mortgages insured under this
section if the customary lending practices of the mortgagee, as
determined by the Secretary pursuant to section 539, provide for a
variation in mortgage charge rates that exceeds 2 percent for insured
mortgages made by the mortgagee on dwellings located within an area. The
Secretary shall ensure that any permissible variations in the mortgage
charge rates of any mortgagee are based only on actual variations in
fees or costs to the mortgagee to make the loan.

 "(2) For purposes of this subsection-

 "(A) the term `area' shall have the meaning given the term under
subsection (b)(2);

 "(B) the term `mortgage charges' includes the interest rate, discount
points, loan origination fee, and any other amount charged to a
mortgagor with respect to an insured mortgage; and

 "(C) the term `mortgage charge rate' means the amount of mortgage
charges for an insured mortgage expressed as a percentage of the initial
principal amount of the mortgage.".

 (b) Sanctions of Mortgagees.-Title V of the National Housing Act (12
U.S.C. 1701 et seq.) is amended by adding at the end the following new
section:
"examinations and sanctions for certain violations

 "Sec. 539. (a) Examinations and Sanctions.-

 "(1) In connection with any examination of a mortgagee approved by the
Secretary pursuant to this Act, the Secretary shall assess the
performance of the mortgagee in meeting the requirements of sections
203(t), 223(a)(7)(B), and 535. Where the Secretary determines that a
mortgagee is not in compliance with these requirements, the Secretary
shall refer the matter to the Mortgagee Review Board for investigation
and appropriate action.

 "(2) Not later than 180 days after the date of the enactment of the
Cranston-Gonzalez National Affordable Housing Act, the Secretary shall
by notice establish a procedure under which (A) any person may file a
request that the Secretary determine whether a mortgagee is in
compliance with sections 203(t), 223(a)(7)(B), and 535, (B) the
Secretary shall inform the person of the disposition of the request, and
(C) the Secretary shall publish in the Federal Register the disposition
of any case referred by the Secretary to the Mortgagee Review Board.
Such procedures shall be established by regulation under section 553 of
title 5, United States Code. The Secretary shall issue regulations based
on the initial notice before the expiration of the 8-month period
beginning on the date of the notice.

 "(3) The Secretary shall submit to Congress, not less than annually,
a report regarding any actions taken to carry out this section. The
report shall include a list of all requests filed pursuant to paragraph
(2) and any action taken pursuant to such requests."

 "(b) Monitoring and Review.-The Secretary shall continually monitor
and undertake a thorough review of the implementation of this section
to assess the impact of the section on the lending practices of
mortgagees and the availability of mortgages insured under this Act. The
Secretary shall monitor the availability of credit, the number and type
of lenders participating in the program, whether there is any change in
the composition or practices of such lenders and any other factors the
Secretary considers appropriate. The Secretary shall submit to the
Congress findings detailing the results of such monitoring and review
not later than 18 months after the enactment of the Cranston-Gonzalez
National Affordable Housing Act.".