1. Short title

This Act may be cited as the "First Time Homebuyer Debt Reduction Act".

2. Classification of student loan payment as a financial concession

(a) In general - Not later than 30 days after the enactment of this Act, the Director of the Federal Housing Finance Agency shall require the enterprises to classify a covered payment as a financial concession with respect to an interested party contribution in the sale of a home, subject to the limitation described in subsection (b).

(b) Limitation - A portion of a covered payment that is in excess of $25,000 shall be classified as a sales concession.

(c) Definitions - In this Act:

(1) Enterprises - The term "enterprises" means—

(A) the Federal National Mortgage Association; and

(B) the Federal Home Loan Mortgage Association.

(2) Covered payment - The term "covered payment" means a payment towards a student loan, as defined in Title IV of the Higher Education Act, by an interested party to the buyer of a home.

(3) Home - Newly constructed principal residence of the buyer of a home.