Cramdown Vote Expected This Week

Senate Democratic leaders want to force a vote on the bankruptcy cramdown issue this week even though they have not reached agreement on the cramdown provisions and it appears they don't have the votes to pass it. The 41 Republican senators are united in opposition to cramdowns and observers expect at least six Democrats will vote against legislation that would allow bankruptcy judges to reduce or cramdown the principal amount of a residential mortgage to the fair market value. Nevertheless, Sen. Richard Durbin, D-Ill., is continuing to work with Wells Fargo, J.P Morgan Chase and Bank of America on compromise cramdown legislation. If an agreement is reached, the cramdown language could be attached a House-passed bill that strengthens the Federal Deposit Insurance Corp. and enhances the Federal Housing Administration loan modification programs. If Sen. Durbin losses that fight, cramdown opponents are concerned Sen. Durbin may try to attach his cramdown provisions to the credit card reform bill that the House is expected to pass later this week.