Will The Government Freeze Mortgage Rates And Change The Bankruptcy Law To Help Homeowners?

There is a lot of talk now about the Federal government stepping in to help stop the growing foreclosure crisis. Two measures being discussed are to freeze interest rates (to help those who have adjustable rate mortgages) and to change the Bankruptcy Code to allow for the modification of residential mortgages in Chapter 13 plans (presently a Chapter 13 debtor can only reinstate the mortgage, but not change it’s terms). It remains to be seen what will actually happen. The banking lobby is very strong and can be expected to oppose these measures. For those homeowners in trouble now, it would be best to consult with an attorney immediately. There is little point in waiting for the government to save you. No one knows if or when that might happen, or whether the law changes will be limited.