Mortgage Cram-Down Bill Passes House
The U.S. House has passed a compromise version of mortgage cram-down legislation, HR 1106, officially known as entitled the "Helping Families Save Their Homes in Bankruptcy Act of 2009."
Among other significant changes, the legislation permits a Chapter 13 bankruptcy plan to: (1) modify the rights of claim holders with respect to a claim for a loan originated before the effective date of the Act and secured by a security interest in the debtor's principal residence that is the subject of a foreclosure notice; and (2) deny debtor liability for certain fees and charges incurred while the bankruptcy case is pending and arising from a debt secured by the debtor's principal residence, unless the claim holder observes specified requirements.
The legislative summary details the bill's other changes, including amendments to the HOPE for Homeowners plan.
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