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U.S. Senate to consider bankruptcy changes

The pro-consumer lobby is trying an end-run that requires urgent action by bankers if we're going to have any chance to defeat it.  The bill number is S. 2636 and, if approved, will have a profound affect on your bank's loan agreements going forward.  

 

We need for all bankers to send a fax to Senators Jim Inhofe and Tom Coburn, and we need it today or tomorrow at the latest.  The bill will be scheduled for action on the Senate floor early this week.  

 

Basically, here's what it does and why it would be bad for banks:  bankruptcy judges would be given authority to “cram down” both the interest rate and the principal amount of all mortgages secured by the borrower's principle residence.  

 

The effort is contained in Title IV, which is a part of the larger package designed to address the mortgage foreclosure problem.  We've been opposing these same provisions in a bill in the House, but the anti-banking lobby is trying this end-run.  We think our two senators are “OK” but it never hurts to make certain that they both know how bankers feel.

Time is short. Simply go online to the following link (http://capwiz.com/aba/issues/alert/?alertid=11033401&type=CO) and enter the information that's listed.  This method will take you less than two minutes to make your views known.

Thanks for your help.  Please circulate this e-mail to all of your employees and ask them to participate.  Please do this right away and don't put it off.  It's very important

Thanks again.

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