Bankruptcy Reform is a Bad Solution to Foreclosures »
Posted By altnrg 9 months, 2 weeks ago in News
The bankruptcy reform proposal in Congress that empowers judges to order mortgage loan modification is not a good solution to the foreclosure problem, says a Barclays Capital analyst.
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crghss9 months, 2 weeks ago
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This is terrible. If you paid to much for your house then so be it. We must let the market run it's course. If you want to change anything make it easier for people to recover from Bankruptcy and start over. You start adjusting the principle balance on people's homes, where does it start and where does it end. If this practice is put in place then we'll all stop paying our mortgages go to court and get our principle adjusted down.
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earthlingerer9 months, 2 weeks ago
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That's perfectly right. If a bank gives out a loan to someone unqualified, and then the person is unable to pay, let them go bankrupt and serve the steaming platter right to the bank. Let them eat some of that turd sandwich for making the loan.
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If you can't do business right, you should be penalized, not bailed out.
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bunnyswanson9 months, 2 weeks ago
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Visa Corp pushed through the most recent BK reform bills, namely, to disallow write offs, Ch 13 only unless the filer is a minimum wage earner. Thank God, the BK judges ignored those rules in many cases. Responsible lending would help. Divorce, job loss, medical emergencies are all very good reasons to be forgiven, and not ruined financially for the rest of one's life, 7-10 years is a long time to be punished with outrageously high interest rates - how could that even help the person who has lost their source of income? It is expensivce to be poor. BK is the least corp american ceos, those wolves we saw in front of congress asking for us to give them some cash cuz well, they screwed up royally. Tax write offs is what corp america is all about. It is time to let patriotism back onto the stage. I would suggest that the FICO and Money and these so-called gods of how the world's people are using their money be told to stick a sock in it. They failed as much if not more by not seeking the cash flows in the business owners. 720 = get a mtg? Let's try 650 = get a mtg and cut the shark loan tactics or maybe it is time to build a new banking system. This is capitalism, afterall. Fair lending should be quite a hit should one have the capital and integrity to go into the business of bartering.
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philipmcelroy9 months, 2 weeks ago
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The Repuplican Bankruptcy Reform(Corporate Welfare and No Responsibility Act/passed around 2003),is one of the primary reasons for the Republican housing market catastrophe. Banks have no responsibility, balances lost on housing loans, are attatched to the original buyer who couldn't and shouldn't have been gived the loans to begin with. Pure Corporate Welfare for the wealthy, dumpted on unsuspecting individuals, for the benifit of the Republican Party.
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qantumreflection9 months, 2 weeks ago
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So says the BANKING oriented official. In the short term, that is all those analysts really care about, will hurt banks, but in the long term will stabilize the entire economy, as more homes will stay in with the homebuyers, mkaing the paper of those banks stable.
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Stability is what the economy needs. -
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erardavis9 months, 2 weeks ago
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Banks are dumping homes on the market and ruining all of our home values...they need to work with folks, which they are not doing because the gov. is giving them money to clean up their balance sheets...ALL homeowners are screwed because these homes are driving our values down and we already are paying the banks in the form of a bailout for these "toxic Mtg." Banks should be forced to work with homesowners by setting aside part of principal, giving lower payments to thoese that need it and recapturing principal when vaules increase. Forclosed homeowners are trashing homes because they are mad...we can do better if we had some people in Wash. with some vision.
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nevrln6199 months, 2 weeks ago
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Ha! As if anyone should pay any attention to any banker nowadays!...Hillary Clinton suggested a moratorium on foreclosures almost two years ago when all this mess started!...The banks have been given a free ride in all this..The losses must be shared among government, banks, and borrowers...The resulting glut of foreclosure listings has destroyed the real estate market for everyone!...If you don't have to sell a house, then gosh'n'golly, it's somebody else's problem and who cares, right?...So much for thinking we live in a country that gives a darn for fairness for all or even intelligence in dealing with our problems...Bankruptcy is a time-honored relief that even the Bible allows...The goal should be to get some stability from the bottom up for a change..Obviously top down rescue has FAILED!
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willottica9 months, 2 weeks ago
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On first reading, I thought it was a terrible idea. But then I realized that giving judges the power doesn't mean they will use it every time.
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On the other hand, in exceptional cases, perhaps the banks issuing the mortgages should be the ones who are making the exceptions. This definitely should not be a carte-blanche solution, it should be rare indeed to have principal write-downs (though interest reductions I could see going into the hands of judges).
Unreasonable principal is not the bank's doing, the buyer agreed to the amount, and the full amount was given to the seller, so to allow judges to write-down principal is to allow judges to punish banks for the greed of sellers, it shouldn't happen.
In conclusion, I think judges should be given the power to order interest-rate reductions only (this punishes the bank if they are unreasonable in their demands). Banks, if they decide it's in their best interests, should be the only ones to authorize principal reductions.-
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jiants19869 months, 2 weeks ago
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This opens the door to even more corruption in the housing industry. Now a judge can pick and choose who they want to help out. There is no clear set of rules or criteria established to see who gets helped and who doesn't. I can see the payoffs beginning right after this gets pushed through.
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