Vote to pass a bill that allows the Secretary of the Treasury to purchase troubled assets from financial institutions, with a total outstanding balance of up to $700 billion.
Establishes the Troubled Asset Relief Program (TARP) to allow the Secretary of the Treasury to purchase troubled assets from any financial institution (Sec. 101).
Sets an initial authority for purchasing troubled assets at $250 billion, extends the authority to $350 billion if the President submits a written certification to Congress stating that the Secretary of the Treasury needs additional authority, and further extends the authority to $700 billion if the President submits a written report detailing the plans of the Secretary unless Congress passes a joint resolution to deny the expansion of authority (Sec. 115).
Allows the Secretary of the Treasury to sell, or enter into securities loans, repurchase transactions, or other financial transactions in regard to, any troubled asset purchased by the Secretary upon terms, conditions, and prices determined by the Secretary (Sec. 106).
Requires that, if the Treasury buys troubled assets directly, there must be (Sec. 111):
Limits on compensation to exclude incentives for senior executives of a financial institution to take risks that may threaten the value of the institution while the Secretary of the Treasury holds an equity or debt position with the institution;
Provisions to recover any bonus compensation paid to senior executives based on statements of earnings proven to be false; and
Prohibition on any "golden parachute" payments to senior executives while the Secretary holds any equity or debt in the institution.
Increases the limitation for the total public debt by $700 billion, for a total of $11.32 trillion (Sec. 122).
Requires revenues from the sale of troubled assets purchased under this act to be used to make payments on the national debt (Sec. 106).
States that if mortgages or other assets secured by residential real estate are purchased by the Treasury, the Secretary of the Treasury must encourage use of the HOPE for Homeowners program and work with the Federal Housing Finance Agency and other agencies in order to improve the loan modification and restructuring process and reduce foreclosures (Sec. 109).
Terminates the Treasury's authority to purchase or insure troubled assets on December 31, 2009 (Sec. 120).
NOTE: THIS IS A SUBSTITUTE BILL, MEANING THE LANGUAGE OF THE ORIGINAL BILL HAS BEEN REPLACED. THE DEGREE TO WHICH THE SUBSTITUTE BILL TEXT DIFFERS FROM THE PREVIOUS VERSION OF THE TEXT CAN VARY GREATLY.