[Dems_R_Losers]

First mortgages have been exempt from bankruptcy since 1978. That is because they are secured loans. Bankruptcy is intended to produce an orderly discharge of unsecured debt. When you get a mortgage, you sign a note that says if you do not pay it the bank takes your house. You don't get to break that contract just because you ran up a bunch of other bills you can't pay and you think you are still entitled to stay in your house or just have a judge wave a wand and reduce your payment.

This change will instantly devalue every mortgage on the books of every bank in the country, and will instantly increase the interest rate on every new mortgage going forward. Just what we need right now! I sure hope the McCain campaign will pick up on this. Obama is promising a change that even Nancy Pelosi backed off on in the bailout bill.

[Hillary's Folly]

Actually, secured loans have always been included in bankruptcy proceedings, how they are dealt with depends on which chapter one files and in a chapter 7 the debtor has the option of re-affirming secured loans in order to retain the collateral. Should they decide to discharge a secured debt then the collateral is returned to the lien holder.

There is a homestead exemption built in to the code that allows a debtor to have a set and small amount of equity in their home if they are current or can become current on their mortgage. Many who file are not behind on their mortgage to begin with. Otherwise they lose the home.

All that is being suggested here is that the individual judge who is hearing the case be given the discretion to size up the debtor in front of them and make what we hope to be a sound judgment based on the fact that he is the authority figure closest to the situation. Judicial discretion is one of the cornerstones of our republic and has been diminished far too often in the last 30 years, taking the final judgment away from the hands closest to the situation and placing in the capricious hands of congressmen hundreds or thousands of miles away.

And remember, not everyone who files bankruptcy is a deadbeat. The historic purpose of the bankruptcy is to provide relief for people based on the understanding of the universal truth that sometimes bad things happen to good people. These are such times and I would rather our government be focused on helping people stay in their homes than increasing the alarming number of homeless people who already inhabit the street of my city, and probably yours too, who in the long run will cost us more than any readjustment of interest payments or principle owed.

Tough times lie ahead my friend and their may come a day when you too feel entitled to a little mercy from the system you’ve helped propped up most of your life.