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Congress Should Amend Bankruptcy Code to Allow for Modification of Residential Mortgages According to Latest ABI Poll

Contact: John Hartgen
             (703) 739-0800
             
jhartgen@abiworld.org

 

CONGRESS SHOULD AMEND BANKRUPTCY CODE TO ALLOW FOR MODIFICATION OF RESIDENTIAL MORTGAGES, ACCORDING TO LATEST ABI POLL

February 22, 2008, Alexandria, Va. —A majority of respondents (66 percent) to ABI’s latest online poll agreed that Congress should amend chapter 13 of the Bankruptcy Code to allow for the modification of residential mortgage terms for homeowners in distress. Fifty-eight percent of respondents “strongly agreed” and 8 percent “somewhat agreed” that Congress should amend chapter 13 to allow for the modification of residential mortgages in the bankruptcy process.

Thirty percent of respondents, however, disagreed that Congress should amend chapter 13 of the Bankruptcy Code to allow for the modification of residential mortgages.  Twenty-two percent “strongly disagreed” and 8 percent “somewhat disagreed” that Congress should amend chapter 13 to allow the modification of residential mortgage terms in bankruptcy. One percent of the respondents did not know or had no opinion on the issue.

In an attempt to stem the tide of predicted foreclosures due to the subprime mortgage crisis, Congress is considering legislation to amend chapter 13 of the Bankruptcy Code to allow bankruptcy judges to modify the terms of a primary residential mortgage for homeowners in distress. The housing stimulus package (S. 2636), introduced by Sen. Harry Reid (D-Nev.), includes the mortgage modification language among its provisions to aid distressed homeowners. The Senate is scheduled to act on S. 2636 next week.

ABI members and members of the public were welcome to submit their response to the statement: “Congress should amend chapter 13 to allow the modification of the terms of residential mortgages in the bankruptcy context.”

ABI’s Quick Poll is posted on ABI’s home page, www.abiworld.org. ABI members and the public are invited to respond to a question on a timely bankruptcy or insolvency issue. Visit http://www.abiworld.net/quickpoll/to access the results of previous ABI Quick Polls.

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ABI is the largest multi-disciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency. ABI was founded in 1982 to provide Congress and the public with unbiased analysis of bankruptcy issues. The ABI membership includes nearly 11,700 attorneys, accountants, bankers, judges, professors, lenders, turnaround specialists and other bankruptcy professionals, providing a forum for the exchange of ideas and information. For additional information on ABI, visit www.abiworld.org. For additional conference information, visit http://www.abiworld.org/conferences.html.