by: Margaret A. Burks
Chapter 13 Trustee; Cincinnati, Ohio
With the recent economic turmoil, there have been rumors that the current 110th Congress may address modification of 11 U.S.C. §1322(b)(2). If not addressed by the 110th Congress in its waning days, legislation most certainly will be introduced in the 111th Congress to make primary home mortgages subject to cramdown.
Currently, 11 U.S.C. §1322 (b)(2) prohibits chapter 13 debtors from modifying first mortgages on their primary residences. Debtors may, however, propose plans that modify mortgages on second homes, personal property, automobiles, vacation homes, rental property and investment or commercial property. 11 U.S.C. §1322(b)(2) has prevented adjustments to primary home mortgages since the Code was enacted in 1978.
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On October 13, the ABI held the Chicago Consumer Bankruptcy Conference at The Standard Club. During the conference, Sam Gerdano, ABI Executive Director, gave an "Inside the Beltway" update providing an overview of the 110th Congress as well as its reaction to the economic crisis, and more directly, issues affecting bankruptcy and predatory lending, mortgage and credit card practices. The presentation also provided insight into bankruptcy-related stances of both presidential candidates. The materials below address the topics that Mr. Gerdano spoke about in his presentation.
Inside the Beltway Update
Click here to view an updated archive of hearings that have been held in the 110th Congress on issues and legislation pertinent to bankruptcy or insolvency law. The matrix has hearings on several timely topics including the private sector's cooperation with mortgage modifications to help troubled homeowners and the role of the hedge fund industry on the current financial crisis.
Note that the chart lists the date of the hearing, the committee where it was held and the hearing title. The hearing title is linked to the committee pages to provide access to written testimony, Member statements and any additional materials or proposals made available by the committee for the hearing.
Please mark your calendars to attend the ABI's 20th Annual Winter Leadership Conference December 4-6 in Tucson, Arizona. On December 5, 2008 the legislation committee in conjunction with the consumer bankruptcy and real estate committees will present "Politics Practicality and People: The Impact of the Mortgage Meltdown in Bankruptcy." The panel will be moderated by Alane A. Becket of Becket & Lee; Malvern, PA, and feature Ronald F. Greenspan of FTI Consulting, Inc; Los Angeles; Hon. David W. Houston, III, U.S. Bankruptcy Court; Aberdeen, Miss.; Debra L. Miller, Standing Chapter 13 Trustee; South Bend, Indiana; and Tara Twomey; National Consumer Law Center; Carmel, Cal.
Please submit articles for publication in future editions of the legislation newsletter to Jon Lieberman, Esq., Lerner Sampson & Rothfuss, at jjl@lsrlaw.com
