Every time I write about foreclosures and the mortgage crisis, I feel like I have to leave a bunch of stuff out. This week was no exception.
Last Thursday, the Mid-South Peace & Justice Center held a summit about combating blight in local neighborhoods as part of its Issues First campaign. Then Monday, U.S. Congressman Steve Cohen hosted a subcommittee meeting about foreclosures at the U of M law school.
One thing panelists talked about were proposed changes to the federal bankruptcy code that would allow judges to modify mortgage loans. Currently, filing Chapter 13 allows for the adjustment of debts, with the exception of a mortgage loan for the debtor’s primary residence.
There’s some concern that that would mean more bankruptcy filings, but David Kennedy, chief judge of the U.S. Bankruptcy Court for the Western District of Tennessee, testified that wasn’t the case.
“People in mortgage trouble are already in bankruptcy court. They will give up their cars, their pets, they’ll forgo buying medicine. They will do anything to be able to keep their homes,” Kennedy said. “I don’t believe there will be a flood of new filings, because these people are already in the courts. We just can’t help them.”
