Conservadems (Bayh) - Continue to Oppose Giving Bankruptcy Courts Any Power To Modify Mortgages

[Median Democrat]

It is apparently okay under current law for a bankrupcty court to modify the terms of commerical loans or vacation properies, but apparently even a limited cramdown that is only applicable for mortgages entered into prior to the passage of the law is too much for Republicans, the mortgage industry, and a select few conservadems.

http://www.politico.com/news/stories/0409/20950.html

/snip

Durbin has waged a long campaign to win passage of the bankruptcy measure, which he believes would help prevent foreclosures. Opponents warn it would raise mortgage rates for all borrowers if mortgage lenders are forced to take on the cost of reducing principal and interest rates in some bankruptcy cases.

Key Senate offices, mortgage lenders and industry groups are negotiating this week and next week to figure out if there is any room for compromise.

Sen. Evan Bayh (D-Ind.) has been among the moderate Democrats seeking to narrow the bankruptcy language. There has also been a rotating group of Republicans engaged on the issue, including Sen. Arlen Specter of Pennsylvania.

The American Bankers Association, the Credit Union National Association and the Independent Community Bankers of America are involved in the talks, representing the banking and mortgage industries. The Center for Responsible Lending, a consumer advocacy group that backs the proposal, has also been intimately involved in the negotiations.

Republican and industry critics view the drawn-out negotiations as evidence that Democratic supporters don’t have the votes. The House passed a broad bankruptcy provision that even moderate Democrats consider too generous in terms of who could access bankruptcy for foreclosure relief. At the other end of the spectrum is a proposal to limit the bankruptcy option to subprime mortgages only, a non-starter for Durbin and Schumer.

/snip

[Ken Burch]

1. Why should Bayh want to make it harder to modify mortgages?

I thought the Conservadems glitch was on spending. Do they also hate the idea of the banks losing a bit of power and the people gaining some? What's up with THAT?

[Median Democrat]

2. What Happened To Republican Outrage At Banks? First, They Oppose Compensation Limits...

...but express outrage over the payment of bonuses.

Now, I am sure they will blame the Obama administration for continuing foreclosures, and express outrage on behalf of homeowners, but oppose giving bankruptcy courts the power to modify mortgages that are underwater.

[Raineyb]

6. The "conservadems" are corporatist DINOs

They answer to their corporate masters. Senator Blah, is in the pocket of Bank of America (among others) he's not interested in helping the people. He's showing his true colors. That's what's up with that.

Regards

[Freddie Stubbs]

7. If you turn the screws too much on banks, some of them may become insolvent

Many banks are in trouble because of bad business decisions which they made. Should the courts force them to make more bad decisions?

[Raineyb]

9. Is there any corporatist behavior that's bad enough for you NOT to make excuses for it?

BTW, the banks are already insolvent that's why they need the taxpayers to prop them up in the first place. Hello!

I see no reason why the banks should profit on loans they knew damn well could never be paid back under the terms in which they were written. And changing the terms of the loans makes it easier for the banks to actually get some money. They wouldn't get any at all if the person just walks away.

[Freddie Stubbs]

12. Will making further poor business decision make banks more solvent?

If changing the terms of the loans are in the interest of the banks, why don't they want to do it?

[Romulox]

15. Simple answer: they're holding out for more taxpayer subsidies.

"If changing the terms of the loans are in the interest of the banks, why don't they want to do it?"

:hi:

[Median Democrat]

18. They Can't Due To Securitization Of Loans...

This is why you need the BK reform.

[Raineyb]

19. What part of "a reworked mortgage is better than having the borrower walk away"

did you not understand?

A little less than one was expecting is better then not getting anything at all.

[Romulox]

10. Heaven forfend! Next thing you know, you "free market" types will demand a taxpayer bailout!

You are a self parody! :hi:

[Freddie Stubbs]

13. You are advocating policies which will cause the banks to ask for further bailouts

[Romulox]

14. There is a *tiny* nuance that you're missing here:

The proposed change to the bankruptcy code would help regular working people rather than just millionaire bankers and their "counterparties".

Shouldn't US taxpayer money help...you know, US taxpayers? Or does the "free market" dictate that all US taxpayer funds be funneled to private equity? :hi:

[Median Democrat]

17. Isn't A Reduced Principal Mortgage Better Than A Foreclosed Mortgage?

I am not sure how a foreclosed mortgage is better for a bank.

[liskddksil]

3. these guys should just join the republicans already

their no friends to average Americans.

[firedupdem]

4. Why are they dems? I don't get it. n/t

[JTFrog]

8. He's not. DINO. n/t

[w4rma]

5. Bayh can go to Hell. (nt)

[flpoljunkie]

11. More evidence Congress does not really work for us, but for the special interests.

Say it ain't so, Senator Dodd!

[avaistheone1]

20. Yes, the banking interests give lots of money to both the republicans and the democrats.

[Supersedeas]

16. the Elitist wing of the DLC wants more More MORE leeway for Banks & Mort. Cos.