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“ Craig D. Robins, Esq., has been a practicing Long Island bankruptcy attorney for over twenty-four years ”
Written by Craig D. Robins, Esq.Newsday calls on Congress to permit bankruptcy cram-down and bankruptcy modification of mortgages
An editorial in today’s Newsday commented that foreclosures on Long Island are still rising, pointing out that voluntary programs are not doing the job, and Congress needs to get more involved with stubborn lenders.
“Underwhelming” was the word Newsday used to describe federal efforts to help homeowners avoid foreclosure.
The problem is that the two major initiatives — “Making Home Affordable” and “Hope for Homeowners” — both rely on lenders to voluntarily modify or refinance loans. However this has not worked, especially on Long Island.
Congress needs to revisit proposed legislation to authorize bankruptcy judges to modify or “cram down” mortgages. See my post, Chapter 13 Mortgage Cram-down Still a Possibility . Newsday believes that if mortgage lenders knew that homeowners had this ability, they would have greater incentive to work with the homeowners, rather than let the homeowners cram down the mortgage in bankruptcy court.
There have been 6,274 foreclosure filings so far this year on Long Island.
