Industry NewsMortgage

Senate nixes mortgage ‘cram downs’

Industry opposed court-imposed loan mods

Don't miss the real estate event of the summer
Join 4,000 real estate pros at Connect SF, Aug 7‑11, 2017

Bankruptcy judges won't get the power to rewrite the terms of mortgages on primary residences anytime soon, after a dozen Democrats joined Republicans in the Senate on Thursday and voted against tacking bankruptcy "cram down" legislation onto another housing bill. In a 45-51 vote, the Senate rejected an amendment to S 896, the Helping Families Save Their Homes Act. Introduced by Sen. Dick Durbin, D-Ill., the amendment would have allowed cram downs on mortgages when homeowners were already in foreclosure and lenders had not offered a loan modification. In a 234-191 vote March 5, the House of Representatives signed off on cram-down language in passing the House version of the bill, HR 1106 (see story). Cram-down supporters say they want to force lenders to step up efforts to help homeowners avoid foreclosure. Bankruptcy judges already have cram-down powers over mortgages on second homes and investment properties. But opponents in the lending industry continued to ...