Dems plan housing push amid dissent

Source: The Hill

Democrats are prepared to bring the party’s housing bill to the floor Thursday, even as centrist members try to limit one of its key provisions.

Centrist Democrats want to limit the number of people who can get their home loans shrunk by bankruptcy judges.

“We want to make sure that people who’ve been offered a modification don’t just use bankruptcy to shop for a better option,” said Rep. Ellen Tauscher (D-Calif.), chairwoman of the centrist New Democrat Coalition.

The bankruptcy legislation is the most contentious part of a broader bill to reinvigorate the housing market. House liberals and the original sponsors of the provision, known as “cramdown” in the financial industry, say there is no reason for the centrists’ concerns, but said they can live with some proposed changes.

“The changes under discussion would still be an effective bill,” said Rep. Brad Miller (D-N.C.), who authored the bankruptcy provision, “and would give homeowners more options than they currently have.” Limiting the bill too much, said Rep. Jim Marshall (D-Ga.), could cause problems passing the bill.

“You’ll start losing votes when you too drastically affect the availability of the remedy for no good reason,” said Marshall, a bankruptcy attorney who originally opposed the bill until he and Miller crafted language they could both live with.

More here.

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