The debate on mortgage modification, aka “Cram Down” has now moved to the Senate where sponsors are lobbying for the 60 votes needed for passage. If passed the mortgage modification bill would create a process that would be an alternative to foreclosures and the current bankruptcy process. Considering the ongoing issues in the housing market, such a process may work to help stabilize housing prices and to keep more people in their homes which is certainly a laudable goal.
CAI’s ongoing concern, and one that we are watching very carefully, is that this new process does not have any of the protections for associations that exist, even in a limited way, under current foreclosure or bankruptcy laws and processes. We will continue to reach out to the Senate sponsors to gain support to amend the proposal to protect community associations ability to collect their assessments. While we all, understandably, want to strengthen the overall market, it would only exacerbate the housing crisis to have increased costs put onto responsible homeowners through higher assessments.
We will be sure to keep all of our members posted as this process moves forward.
