Update: Judicial Modification of Mortgages (Bankruptcy) Bill in the Senate
March 16, 2009
The proposed “Helping Families Save Their Homes Act of 2009″ would give bankruptcy judges power to modify residential mortgages. For earlier posts on this topic, click here.
A version of the bill passed the House on March 5, 2009. It is now in the Senate, where some of its key provisions are facing opposition.
Democrats had hoped to vote on the bill before the April recess, but a vote has not yet been scheduled due to ongoing negotiations in the Senate.
Main areas of conflict appear to be the bill’s “cramdown” provisions and a proposal to limit bankruptcy relief to subprime mortgages only.
According to the National Association of Consumer Advocates, limiting the proposed relief to subprime mortgages would deny bankruptcy protection to approximately 60% of the homeowners most at risk of foreclosure.
The Center for Responsible Lending has summarized key provisions of the House version in this document. The document also discusses how the proposed legislation would reduce foreclosures without creating additional costs for U.S. taxpayers.
To voice your opinion about the proposed bill, call your Senator. The US Capitol Switchboard’s number is (202) 224-3121. A switchboard operator will connect you with the Senate office you request.
Portions of the above post were excerpted from a National Association of Consumer Advocates email alert.
Now scheduled for Senate vote:Â read the April 29, 2009 update
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