HR 5500 - Foreclosure Credit Forgiveness Act of 2008

To amend the Fair Credit Reporting Act to provide forbearance from foreclosures of subprime mortgages in the determination of a consumer credit score, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

February 26, 2008

Mr. WYNN introduced the following bill; which was referred to the Committee on Financial Services

A BILL

To amend the Fair Credit Reporting Act to provide forbearance from foreclosures of subprime mortgages in the determination of a consumer credit score, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Foreclosure Credit Forgiveness Act of 2008'.

SEC. 2. FORBEARANCE IN CREATION OF CREDIT SCORE.

(a) In General- Section 609 of the Fair Credit Reporting Act (15 U.S.C. 1681g) is amended by adding at the end the following new subsection:

`(h) Foreclosure on Subprime Not Taken Into Account for Credit Scores-

`(1) IN GENERAL- A foreclosure on a subprime mortgage of a consumer may not be taken into account by any person in preparing or calculating the credit score (as defined in subsection (f)(2)) for, or with respect to, the consumer.

`(2) SUBPRIME DEFINED- The term `subprime mortgage' means any consumer credit transaction secured by the principal dwelling of the consumer that bears or otherwise meets the terms and characteristics for such a transaction that the Board has defined as a subprime mortgage.'.

(b) Regulations- The Board shall prescribe regulations defining a subprime mortgage for purposes of the amendment made by subsection (a) before the end of the 90-day period beginning on the date of the enactment of this Act.

(c) Effective Date- The amendment made by subsection (a) shall take effect at the end of the 30-day period beginning on the date of the enactment of this Act and shall apply without regard to the date of the foreclosure.

END