U.S. Rep. Larry Kissell joined 23 other Democrats and 167 Republicans this week in opposing a bill that would let bankruptcy judges rewrite home loans and shield mortgage servicers who modify loans from bondholder lawsuits.

The legislation, which aims to ease a deep U.S. housing slump, would also strengthen the ability of the Federal Deposit Insurance Corp to deal with bank failures and make permanent an increase in the insured deposit limit to $250,000.

Scotland County's representative said he opposed the bill because he is against using bankruptcy as the centerpiece to the bill.

"We need to talk about how to keep working Americans in their homes," Kissell said.

"In North Carolina around three percent of mortgages are seriously delinquent, and I just don’t believe it sends the right message to the 97 percent of folks who are tightening their belts and struggling to pay their bills on time in this hard economic situation we are in," Kissell said.

The bill also contains a "safe harbor" provision that offers liability protection to mortgage servicers who modify loans to help distressed borrowers stay in their homes.

Since many home loans are repackaged into debt securities and sold to investors, mortgage servicers could face lawsuits from bondholders if they rewrote the loan terms.

The legislation also increases the Federal Deposit Insurance Corp's credit line with the U.S. Treasury to $100 billion from $30 billion, providing more firepower to tackle what could be a growing wave of bank failures.

In seeking the increase, the FDIC characterized it as prudent contingency planning.

Kissell said he understands some people and businesses do find themselves with no other option and that he supports them having the ability to reorganize, despite opposing the expansion of current bankruptcy law.

"I’m very pleased that there are initiatives under way that will allow those who may be facing problems with their mortgage to get assistance through the Department of Housing and Urban Development," Kissell said.

Kissell added that he is cosponsor of a bill introduced by Republican Congressman Bill Shuster which grants a $5,000 tax credit to citizens who have made their monthly mortgage payments on time."

That legislation would give current mortgage holders of a principle residence this tax credit if the holder provides certification from the lender that they are not delinquent in their payments.

"The misfortune of many Americans suffering from the housing market is troubling, and they will be assisted through this crisis. But then we should also acknowledge and reward the tens of millions more who are managing to stay faithful in their payments."