This is just a really bad move.
Once again, those who mismanaged their lives will be gifted and those who DID manage their lives will be...expected to gift those who erred.
- Allows bankruptcy judges to make changes on existing loans only, not future ones. Changes could include reducing the principal or interest rate, as well as extending the length of the loan. They could lower the interest rate to as low as 2%.
This makes no sense and will not solve the underlying problems. It is a gratuitous gift and I don't feel like footing the bill...again.
- The goal behind these measures is to ensure homeowners have sought other ways to get relief before turning to bankruptcy. The bill also protects lenders from lawsuits for reasonable loan modifications
This should scare everyone but it will get lost in the weeds of this entire mortgage issue.
Once again, a credit/lending based organization is getting their hands in the bankruptcy process. They lobbied for ten years to restrict bankruptcy protection which they finally got a couple years ago. Now, they want the ability to decide whether or not someone has jumped enough hoops to be allowed certain bankruptcy protections. These are supposed to be ours, by law.
I don't see much of this happening to Mr. Madoff.
I stick behind my prior post.
Nothing but worse and worse news for those of us who have lived frugally. We will get none of the benefits and all the costs of this mortgage nightmare our government regulators allowed to happen.
