Today’s editorial in USA Today chides lenders for playing the “extend and pretend” game with mortgage modifications. The piece is one of the first of what I hope is a larger chorus of supporters of amending the Bankruptcy Code to permit modifications on residences.
There’s just one problem with this game of “extend and pretend.” It’s bad for everyone concerned, including the banks. As the number of houses in foreclosure grows, it damages neighborhoods and pushes down home values.
The best thing Congress could do to aid hard-pressed homeowners is to alter bankruptcy law to allow judges to modify troubled mortgages, as they do with virtually all other debts. This common-sense change would give lenders more incentive to make modifications themselves, rather than lose control to a bankruptcy judge.
It’s time to start pressuring Washington about this again. And this time, we need to be sure that Washington hears from everyone. Start talking.
Related posts:
- Some ‘Provocative’ Questions about ‘Extend and Pretend’
- Mortgage Modification Legislation Update: Citigroup Supports the Bill
- Mortgage Modification Update: Not so Hopeful
- Mortgage Modification/Cramdown Bill Update
- Saving the Home: Thinking Beyond “Delay and Pray”
Tags: Modifications and Workouts, Mortgages and Foreclosures, USA Today
