12 U.S.C. § 1701x–2: Legal assistance for…

Summary

The Secretary of Housing and Urban Development must create a grant program to pay for legal help for low- and moderate-income homeowners and tenants who face mortgage default, foreclosure, or eviction tied to foreclosure. Grants must be given through a competitive process to state and local groups whose main job is providing legal aid, with priority for groups working in the 125 metropolitan areas with the highest foreclosure rates. Grant money can only help owner-occupied homeowners with mortgages that are in default, at risk of default, or facing foreclosure, and tenants facing eviction because of foreclosure. Recipients must start using the funds within 90 days. Funds cannot be used for class-action lawsuits and can only pay for work on mortgage-related defaults, evictions, or foreclosure proceedings (judicial or nonjudicial). Organizations convicted of federal election crimes, or that employ or contract with an "applicable individual" (someone working for the group who has such a conviction), cannot get funds. $35,000,000 is authorized for each of fiscal years 2011 and 2012. The rules in the program took effect July 21, 2010.

Title 12, §1701x–2

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(a)Establishment

The Secretary of Housing and Urban Development (hereafter in this section referred to as the “Secretary”) shall establish a program for making grants for providing a full range of foreclosure legal assistance to low- and moderate-income homeowners and tenants related to home ownership preservation, home foreclosure prevention, and tenancy associated with home foreclosure.

(b)Competitive allocation

The Secretary shall allocate amounts made available for grants under this section to State and local legal organizations on the basis of a competitive process. For purposes of this subsection “State and local legal organizations” are those State and local organizations whose primary business or mission is to provide legal assistance.

(c)Priority to certain areas

In allocating amounts in accordance with subsection (b), the Secretary shall give priority consideration to State and local legal organizations that are operating in the 125 metropolitan statistical areas (as that term is defined by the Director of the Office of Management and Budget) with the highest home foreclosure rates.

(d)Legal assistance

(1)In general

Any State or local legal organization that receives financial assistance pursuant to this section may use such amounts only to assist—

(A)homeowners of owner-occupied homes with mortgages in default, in danger of default, or subject to or at risk of foreclosure; and

(B)tenants at risk of or subject to eviction as a result of foreclosure of the property in which such tenant resides.

(2)Commence use within 90 days

Any State or local legal organization that receives financial assistance pursuant to this section shall begin using any financial assistance received under this section within 90 days after receipt of the assistance.

(3)Prohibition on class actions

No funds provided to a State or local legal organization under this section may be used to support any class action litigation.

(4)Limitation on legal assistance

Legal assistance funded with amounts provided under this section shall be limited to mortgage-related default, eviction, or foreclosure proceedings, without regard to whether such foreclosure is judicial or nonjudicial.

(5)Effective date

Notwithstanding any other provision of this Act, this subsection shall take effect on July 21, 2010.

(e)Limitation on distribution of assistance

(1)In general

None of the amounts made available under this section shall be distributed to—

(A)any organization which has been convicted for a violation under Federal law relating to an election for Federal office; or

(B)any organization which employs applicable individuals.

(2)Definition of applicable individuals

In this subsection, the term “applicable individual” means an individual who—

(A)is—

(i)employed by the organization in a permanent or temporary capacity;

(ii)contracted or retained by the organization; or

(iii)acting on behalf of, or with the express or apparent authority of, the organization; and

(B)has been convicted for a violation under Federal law relating to an election for Federal office.

(f)Authorization of appropriations

There are authorized to be appropriated to the Secretary $35,000,000 for each of fiscal years 2011 through 2012 for grants under this section.

Notes & Related Subsidiaries

Editorial Notes

References in Text

This Act, referred to in subsec. (d)(5), is Pub. L. 111–203, July 21, 2010, 124 Stat. 1376, known as the Dodd-Frank Wall Street Reform and Consumer Protection Act, which enacted chapter 53 (§ 5301 et seq.) of this title and chapters 108 (§ 8201 et seq.) and 109 (§ 8301 et seq.) of Title 15, Commerce and Trade, and enacted, amended, and repealed numerous other sections and notes in the Code. For complete classification of this Act to the Code, see

Short Title

note set out under section 5301 of this title and Tables. Codification Section was enacted as part of the Mortgage Reform and Anti-Predatory Lending Act and also as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and not as part of the National Housing Act which comprises this chapter.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective on the date on which final

Regulations

implementing such section take effect, or on the date that is 18 months after the designated transfer date if such

Regulations

have not been issued by that date, see section 1400(c) of Pub. L. 111–203, set out as an

Effective Date

of 2010 Amendment note under section 1601 of Title 15, Commerce and Trade. Definition of “State” For definition of “State”, see section 5301 of this title.

§1701x–2 Legal Assistance for Foreclosure-related Issues

Summary

Title 12, §1701x–2

Notes & Related Subsidiaries

Editorial Notes

References in Text

Short Title

Statutory Notes and Related Subsidiaries

Effective Date

Regulations

Regulations

Effective Date

Citations & Metadata