A few lawmakers have made a deal with Citigroup, Inc. to let bankruptcy judges alter home loans. The proposed change in bankruptcy law, which some Democratic senators hope to attach to President-elect Obamaâ€™s economic stimulus plan, could help lessen the foreclosure crisis. But the Barre-Montpelier Times Argus stated that home foreclosures in Vermont are showing signs of slowing. Vermont has the 8th lowest percentage of delinquent or foreclosed mortgages, and home prices have remained steady.
Senators Richard Durbin of Illinois, Charles Schumer of New York and Christopher Dodd of Connecticut worked with Citigroup on the plan, which would be limited to loans made before the bill is signed. To qualify, borrowers would need to show that they have asked their lender for a loan modification before filing for bankruptcy. Other banks have expressed interest in the idea.
Obama stated in a speech January 8th at George Mason University that he hoped to start â€œa sweeping effort to address the foreclosure crisis so that we can keep families in their homes.â€
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