Let Bankruptcy Judges Modify

Carmen Dellutri's picture

Bankruptcy Judges want to disspell the myth about how these mortgages are really going to be valued.

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Gov. Martin OMalley's picture

The Senate must act quickly to reform bankruptcy law to allow judges to alter the terms of home loans.

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Michael G. Doan's picture

Its a no brainer for anyone wanting to save their home from foreclosure.

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John Conyers Jr's picture

It represents one of the most tangible and productive steps we can take to limit the fallout.

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Hon. J. Rich Leonard's picture

Homeowners are the only ones who cannot modify the terms of their secured debts in bankruptcy.

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Matthew Mason's picture

Voluntary consumer loan mods, typically involving rate reduction and decrease in principal were nonexistent.

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There is a Better Option

Barry Jay Epstein's picture

[L]ittle thought is being given to future consequences, intended or not, of this machination.

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Michele M. Bachmann's picture

A seriously misguided bill that will actually add more instability.

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barbed-wire-smile's picture

The passage of such legislation would be an unmitigated disaster for our economy.

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Alan Schwartz's picture

There are many others things that can be done to help debtors retain their homes instead of bankruptcy.

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James Pethokoukis's picture

No prudent banker will ever bet on the lower middle class ever again if this passes.

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Andrew M. Grossman's picture

Fundamentally, strip-down is a poor "fit" for the problem of rising foreclosure rates.

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Your opinion

To be eligible for mortgage modification in chapter 13, a debtor should first attempt to reach an agreement with the lender outside of bankruptcy court.

Agree Strongly
44% (104 votes)
Agree Somewhat
23% (54 votes)
Disagree Somewhat
7% (17 votes)
Disagree Strongly
25% (59 votes)
Total votes: 234
Date published: Mar 16, 2009

Bankruptcy judges should be allowed to modify only subprime residential mortgages.

Agree Strongly
27% (43 votes)
Agree Somewhat
11% (17 votes)
Disagree Somewhat
11% (17 votes)
Disagree Strongly
52% (82 votes)
Total votes: 159
Date published: Mar 13, 2009

If a bankruptcy judge allows modification of a debtor's residential mortgage and the debtor later defaults, resulting in dismissal, the underlying security interest should revert back to its original terms.

Agree Strongly
50% (82 votes)
Agree Somewhat
23% (37 votes)
Disagree Somewhat
13% (21 votes)
Disagree Strongly
14% (23 votes)
Total votes: 163
Date published: Mar 13, 2009

Issue 2



See all of Issue 1 'Bankruptcy or Bailout?'
See issue 2 'Mortgage Cramdown'

Date published: Mar 11, 2009

Let Bankrutpcy Judges Modify

David M. Certner's picture

Judicial modification of primary mortgages must be part of any crisis solution.

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Lenn Harley's picture

Americans didn't buy homes they couldn't afford...

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Adam J. Levitin's picture

The vast majority of voluntary loan modifications fail to reduce monthly payments, making them near worthless.

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Michael D. Calhoun's picture

[A] court can provide an economically rational solution when the investors or servicers do not.

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Sherrif Thomas J. Dart's picture

Durbin's plan is exactly the type of bold stand American homeowners need.

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Henry E. Hildebrand's picture

Traditional tools to deal with mortgage defaults are proving to be inadequate to handle the problem.

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Lynn M. Lopucki's picture

The bankers still don't have people in place with the knowledge, skills and incentives to deal with the crisis.

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Unattributed's picture

“[Congress] should insist that borrowers be given a chance to modify their mortgages under bankruptcy court protection . . .

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Wade Henderson's picture

[The bill] is a strong and thoughtful proposal that will save families from losing their homes.

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Jack Kemp's picture

I particularly appreciate the opportunity to reemphasize the importance of the homeownership culture in America.

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There is a better option

James Raider's picture

Where is the common sense?

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Rubin and Eisenberg's picture

Billions of dollars may be lost as underwater homeowners rush to re-write mortgages

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Dr. Christopher J. Mayer's picture

Amending the Bankruptcy Code to permit cram down of first mortgages would generate serious lending risks.

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Rod S. Dubitsky's picture

If servicers can't handle documenting a large amount of loan mods, why assume the bankruptcy courts can?

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Andrew Jeffery's picture

The road to over-regulation has begun.

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Scott A. Stengel's picture

...a change to the bankruptcy laws is not the answer.

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Dr. Christopher J. Mayer's picture

Rather than using the bankruptcy courts, policymakers should consider focusing on the mortgage market.

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David G. Kittle's picture

One of the greatest potential destabilizing initiatives is 'cramdown' for home mortgages.

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Edward R. Morrison's picture

The current proposals to change the Bankruptcy Code are deeply problematic.

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Todd J. Zywicki's picture

A windfall for some troubled homeowners -- but its costs will be borne by aspiring future homeowners.

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Your Opinion

Legislation to permit bankruptcy judges to modify residential mortgages should address the appropriate valuation methods and procedures.

Agree Strongly
69% (49 votes)
Agree Somewhat
20% (14 votes)
Disagree Somewhat
6% (4 votes)
Disagree Strongly
6% (4 votes)
Total votes: 71
Date published: Mar 13, 2009

Allowing bankruptcy judges to modify residential mortgages will further reduce future credit to consumers.

Agree Strongly
25% (17 votes)
Agree Somewhat
13% (9 votes)
Disagree Somewhat
16% (11 votes)
Disagree Strongly
46% (31 votes)
Total votes: 68
Date published: Mar 13, 2009

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