Although President Obama’s new housing plan may be “loaded with incentives for homeowners, mortgage servicers, lenders and banks” to modify the loans that are leading so many Orange County residents to foreclosure and bankruptcy, what the plan does not do is address the so-called “cramdown” proposal — that Bankruptcy judges be allowed to modify home loans. This change in bankruptcy law would be a boon for the clients of Orange County bankruptcy attorneys; it would help many Chapter 7 bankruptcy clients keep their Orange County homes. This is not only an issue for homes in lower income Orange County areas like Santa Ana, but also in areas like Irvine and Newport Beach, where homes with outrageously high mortgage payments have been forcing even high income earners into seeking a bankruptcy attorney or leading to foreclosure. The best that can be said about this housing plan, at least with regard to bankruptcy law, is that it does not “rule out” the possibility that a future bill might tackle this issue.
Orange County has been waiting for such a bill for a long time and it looks like the wait shall continue…
For More Information about the New Housing Plan, click here
