Whitehouse Pushes Geithner on Bankruptcy Reform to Limit Foreclosures
Senator Shares Rhode Islanders’ Stories with Treasury Secretary
Washington, DC - As millions of American homeowners continue to struggle against the tide of home foreclosures, U.S. Senator Sheldon Whitehouse (D-RI) today continued to push for bankruptcy reform to help people stay in their homes. During a Senate Budget Committee hearing with Treasury Secretary Timothy Geithner, Whitehouse shared stories from Rhode Islanders who have struggled to avoid foreclosure and urged the Secretary to support bankruptcy reforms that would allow mortgage modifications.
"Jeff Burlingame, a firefighter from Woonsocket, told me at one of the hearings about the absolute nightmare that his family was put through just trying to deal with the bank," said Whitehouse. "Joe Verdelotti, an electrician in West Warwick, told me about his wife and him basically having to pass the phone when he came home from work and she went off to work because they were stuck on the phone going from voicemail to voicemail...for so many hours." Whitehouse then asked Geithner to "please support the change in the law that would allow a residential primary mortgage to be reset in bankruptcy the way that every other debt can be."
Whitehouse is a cosponsor of the Helping Families Save Their Homes in Bankruptcy Act of 2009 (S. 61), introduced by Sen. Dick Durbin (D-IL), which would allow bankruptcy judges to modify the terms of home mortgages, in the same manner that they are currently permitted to modify the terms of almost every other type of contract. This would help families who get forced into bankruptcy to keep their homes, and would provide consumers with a powerful bargaining chip to renegotiate mortgage terms with their lenders.
Whitehouse held two hearings on this issue in his Judiciary Subcommittee in 2009 during which Verdelotti and Burlingame both testified about their struggles.
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