Bankruptcy Lawyers Push Mortgage Revision Bill

Consumer bankruptcy attorneys took to Capitol Hill Tuesday, urging lawmakers to get behind legislation that would allow bankruptcy judges to modify mortgages to help homeowners keep their houses.

Members of the National Association of Consumer Bankruptcy Attorneys spent the day lobbying for support of the "Helping Families Save Their Homes in Bankruptcy Act of 2009," HR. 200, and its Senate companion, S. 61, which would give bankruptcy judges the ability to modify the terms of a homeowner's mortgage in Chapter 13 proceedings.

Going from one lawmaker's office to another, the members of the group tried to buoy support among Democrats and bring some Republicans on board.

Being careful to call the measure a "mortgage modification bill" - eschewing the term "cramdown" and its negative subtext - the attorneys argued that the measure allows homeowners to do what their lenders want: pay, not walk away.

"People talk about [borrowers] taking personal responsibility," said Matthew J. Mason, NACBA board member and attorney for the UAW-GM Legal Services Plan in Detroit, where the foreclosure crisis is particularly dire. "Chapter 13 is the ultimate example of taking responsibility. Instead of walking away from the house and letting it go into foreclosure, the homeowner is looking for a way to pay."