Foreclosure Prevention Act making its way through Congress has some members divided whether judges should be able to trim the loans of homeowners who are underwater with mortgages:
The Senate is poised this week to approve the housing legislation, dubbed the Foreclosure Prevention Act. Heavy on tax breaks for homeowners as well as for businesses incurring losses, the legislation has earned the ire of unions, consumers groups and other advocates for troubled borrowers, who complain that it does not do enough to help people at risk of losing their homes. Their chief objection is the absence of the bankruptcy measure, which would allow judges to trim the mortgage debts on homeowners’ primary residences.
It’s still very early to try to assess all of this. A lot of horse-trading still to be done.
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