House Committee Approves Mortgage Modification in Bankruptcy Bill

Also of interest is that Credit Suisse concluded that these bankruptcy provisions could reduce foreclosures by 20% and help stabilize the housing market, according to Rueters. Its report indicated that the legislation gives lenders incentive to voluntarily workout loan modifications with their customers. There was another report issued by Friedman, Billings & Ramsey Co. that warned of a chilling effect of the bankruptcy legislation that would scare more banks away from the housing lending market. The report also speculated that the legislation will damage banks that specialize in second liens or home equity lines of credit. This report fears increased bankruptcy filings which will increase losses across the "sector." Also of interest is that Credit Suisse concluded that these bankruptcy provisions could reduce foreclosures by 20% and help stabilize the housing market, according to Rueters. Its report indicated that the legislation gives lenders incentive to voluntarily workout loan modifications with their customers. There was another report issued by Friedman, Billings & Ramsey Co. that warned of a chilling effect of the bankruptcy legislation that would scare more banks away from the housing lending market. The report also speculated that the legislation will damage banks that specialize in second liens or home equity lines of credit. This report fears increased bankruptcy filings which will increase losses across the "sector."