The House approved a bill that would now allow bankruptcy judges to reduce mortgage debt on primary residences of people who are threatened with foreclosure. The current law only allows reduce debt like on a car, vacation home or family farm but not on primary residences.
The bill is without opposition. Bankers see very negative effects to everyone’s cash flow though many representatives who voted for the bill see it as a way to salvage the US real estate market. The House voted 234 for and 191 against.
The Senate is expected to have a similar bill to pass though many are still uncertain on how the Senate will be voting.
This would definitely be a cause of a sigh of relief for homeowners at the brink of foreclosure. At least there’s now hope for them to keep a roof over their heads. 9 million Americans are in the verge of being homeless due to the real estate market collapse.
Source: CNN
