Citibank Endorsing Residential Mortgage Cramdown

It has been reported that Citibank has reached an agreement with Democratic legislators that clears the way for legislation that would give bankruptcy judges the authority to restructure a chapter 13 bankruptcy debtor's residential mortgage. Citibank agreed not to oppose this legislative measure despite historical opposition. In exchange, the legislation will require that debtors indicate they attempted to work out a loan modification with their lender before filing for bankruptcy and the legislation would be limited in scope and only cover loans written before the effective date of the legislation. It has been reported that Citibank has reached an agreement with Democratic legislators that clears the way for legislation that would give bankruptcy judges the authority to restructure a chapter 13 bankruptcy debtor's residential mortgage. Citibank agreed not to oppose this legislative measure despite historical opposition. In exchange, the legislation will require that debtors indicate they attempted to work out a loan modification with their lender before filing for bankruptcy and the legislation would be limited in scope and only cover loans written before the effective date of the legislation.