Senator Dick Durbin introduced new legislation (S.61) titled the Helping Families Save Their Homes In Bankruptcy Act of 2009 . Also, the exact same legislation was introduced in the House of Representatives by Representative John Conyers.
This legislation, if passed, will allow Bankruptcy Judges to modify the mortgages on residential real estate, a practice which the current Bankruptcy Code prohibits. In the past, similar legislation failed to get the necessary support to move through Congress, and the President vowed to veto any bills containing the mortgage modification language.
However, the recession has changed some minds in Congress. This legislation seems to be on the fast track to be included in the new stimulus legislation that is also moving through Congress.
It appears that the Democrats in Congress were serious about making changes to help ease the country out of recession. Allowing Bankruptcy Judges to modify mortgages in Bankruptcy Court is not a new topic. Bankruptcy Judges deal with valuation of assets on a daily basis in Bankruptcy Courts across the nation.
This legislation is being supported by twenty three (23) State Attorney Generals. Likewise, AARP has made this one of their top priorities for 2009.
The reality is simple. The banks have received or will receive more than they should under the Bailout. We the taxpayers are bailing out everyone on a daily basis, and in the future, I'm sure the hand outs will continue. Why are we so afraid to help the working guy or gal? Hasn't corporate America taken advantage of the working class long enough? How much money from the bailout has actually made it to Main Street?
Allowing people the opportunity to save their homes, modify the mortgages, and deal with all of their financial issues in one place will result in more people saving their homes and communities, and hopefully, provide families with more disposable income.
Bankruptcy is a process of bringing debtors and creditors together in a forum to deal with their financial issues. Adding one step in the process may seem like it will be harmful, but in reality, it will result in more people saving their homes and dealing with all of their financial issues.
