“With the number of foreclosures expected to rise and loan modification programs proving to be ineffective, the Congress has no other choice but to take much more aggressive measures to get the mortgage crisis under control and help Americans stay in their homes,” said Delahunt. “The bursting of the housing bubble has created widespread collateral damage on Wall Street and throughout our entire economy, and this legislation will help millions without costing the taxpayers a dime.”
The Helping Families Save Their Homes in Bankruptcy Act makes a straightforward change to the law to give homeowners filing for bankruptcy the opportunity to restructure their loans so that they can save their homes from foreclosure just as they can with virtually any other asset, including vacation homes, family farms, and boats. Specifically, the bill would empower bankruptcy judges to modify terms of subprime and other questionable mortgages to help homeowners stay in their homes.
Conyers added that foreclosures are now expected to claim more than 8 million homes by 2012. This represents 16% of all mortgages in America.
"The problems we are seeing in the economy started with the mortgage meltdown in the subprime market," said Sánchez. "To make the economy bloom again, we need to plant the seeds of recovery in the housing market. As the law currently stands, judges can restructure debt on second homes, vacation homes -- even yachts and private jets, but not on a debtor's first home. I think that is fundamentally unfair. There is no reason why average Americans should not have the same legal protection to save their family homes."
"Attempts by Congress to allow lenders the discretion to voluntarily modify mortgages have not produced the desired results. Congress must now act to afford homeowners the same protections enjoyed by businesses and the very rich,” said Nadler.
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