Durbin Considers Cramdown-Related Amendment As Part Of Wall Street Reform

Senate Majority Whip Dick Durbin (D-Ill.) is considering amending Wall Street reform legislation to allow something similar to judicial modification of mortgages, a process known informally as "cramdown."

"We are looking at variations on that theme that might achieve that same result and I haven't made a final decision on whether we'll offer it on this bill yet," Durbin said on a conference call with reporters Monday. "We are considering some variations on that but they haven't been solidified as of today. I just want to see if the support is there."

A Durbin staffer said Wednesday that if Durbin does in fact offer a cramdown amendment, it will be different from a previous version of cramdown that failed spectacularly last year in a Senate vote after passing the House.

It was after that vote that Durbin famously said of the Senate that banks "frankly own the place." <snip>

More at link: http://www.huffingtonpost.com/2010/05/05/durbin-considers-cramdown_n_564283.html

I would welcome an amendment for this.

Everyone with a mortgage underwater (and who actually could afford the home they were buying) could have leveled things out , and done it cheaper too..

The way they chose to do it, only allowed the banks to keep their bogus mortgages, and left people on the hook for hyper-inflated mortgages, and then dumped millions of foreclosed houses onto the market.

All this stuff is computerized.. It's not rocket science. There was a way to evaluate what percentage particular markets were overrated. and to just reduce the principle amounts by the percentage. People could have suddenly afforded payments, and banks would not be siting on loads of bogus loans on empty houses..

This could have easily been limited to homes worth no more than a specified amount (to keep the Richie Rich types from scamming the system)

For example, they could have extended mortgages over a longer period of time -- a 30-year mortgage into a 60-year. Essentially, people would have been paying rent for their homes. But the social upheaval would have been avoided.

The way this was handled is just shameful.

:hi: