Grassley apoplectic re Kennedy's amendment to raise homestead exemption

[flpoljunkie]

limit to $300,00. The bill right now sets a limit of $125,000--which is not enough to protect ordinary folks in today's overinflated housing market.

The Rethugs have all sorts of provisions in the bill that would allow millionaires like 'Kenny Boy" Lay to protect their assets, including their homes, through asset trusts--instruments are unavailable to the average working American.

[MissMarple]

1. I wonder what the median income and home values are in his state?

I wonder if he knows how stupid this looks? To bad the folks back home aren't paying attention.

[flpoljunkie]

3. His 2004 median income is $42,961. Let Grassley try living on that!

[sandnsea]

11. Median wages

We've got to start talking about median wages because they run about $10,000 less than median income.

[AP]

2. If you can only protect up to 125,000 equity in your home, then this is

a huge boon for the credit card companies (presuming their indebted victims haven't tapped out their equity with fourth and fifth mortgages).

I bet 75% of homeowners would have homes worth more than that, and so credit card companies would ALWAYS have something to make you sell so that they could get their money.

Correct me if I'm wrong, but if you had a $130,000 house and you had at least $5K in equity in it and that's what you owed on your credit card, the credit card company could force you to sell your house in order to get that $5K (or would they just force you take out a home equity loan -- if you could get one -- to get that money?).

[Inland]

8. Yes, to both: creditors can obtain the value in excess of exemption

although in reality, the person with the home would take out an equity loan for the five grand and pay it.

[AP]

14. I wonder how many lenders would want to get third or fourth in line on

the the property for someone about to go into bankruptcy.

I suspect the problem for some will be that they may have equity in their house, but they wouldn't be able to get a loan for the full value of the debt. So in that case, they'd probably be forced to sell. No?

Ie, if you have 30k in credit card debt and 30k in equity (over the 125k homestead exemption) at current FMV, but could only get a loan for, say 20k, I suspect that you'd have to sell the house? No? The credit card company is going to want all 30K and they're going to look at your house and say that's where the money is even if you can't get personal loan against your built up equity that would satsify what you owe the credit card company.

[Inland]

15. To the credit card company, it's all the same.

The credit card company, as an unsecured lender, is in the same position whether it forces a sale or the debtor borrows up to the equity value of the house. In either case, the unsecured lender isn't going to realize any more money. EG, I have a 160,000 house, with ten thousand equity, and outstanding unsecured debts of 30,000 and no other assets. I declare chapter seven, reaffirm my mortgage, and (assuming no other exemptions) the most the unsecured creditors could get is 10,000, period, under the old rules. So they wouldn't paid one hundred on the dollar, so they will take ten grand.

Lenders will be conservative on what can be lent, but then again, there are costs associated with forcing a sale that would keep the unsecured creditor from realizing a hundred cents on the dollar.

You ask, who would lend to a person who is bankrupt? Lots of people, if you can secure the debt in a home. In fact, a person who files for bankruptcy isn't a bad credit risk per se. You would find that credit card companies will immediately issue new cards, since you do know one thing--they won't be able to file another petition in bankruptcy for ten years.

[flpoljunkie]

13. Bingo, AP! A huge boon for the banks and credit card companies, indeed!

[Deep13]

4. Ted just doesn't get it.

Raising homestead exemptions will not screw the poor or provide a windfall for the rich and that is the purpose of the bankruptcy bill.

Most states have opted out of the Federal exemptions (something the Federal law permits). The homestead exemption in OH is a whopping $5000 per person. That means, unless the debtor reaffirms on a huge home mortgage, he or she will loose the house.
:mad:

[Daphne08]

5. I've been watching this and Sen. Kennedy lambasted Ken Lay

who 'slipped through' a loophole.

I wonder how many of Lay's ex-employees (who lost their retirement account funds) know that he lives in a $7 million mansion right now... I'm pretty certain that's the figure that Kennedy gave.

[flpoljunkie]

6. Kennedy amendment went down 47-53. Which Dems betrayed the party?

I noted there were some Republican votes for Kennedy's amendment. The Dem votes against it I heard were Baucus and Nelson of Florida--obviously there were others!

How effing convenient that there is somehow always votes enough to kill any amendments that would help consumers! The fix appears to be in!

[flpoljunkie]

9. Joining Baucus and Nelson, FL was Nelson, NE to vote No on Kennedy Amdt.

Link to vote: Several Republicans voted for Kennedy's amendment including Chafee, Collins, Dewine, Snowe and Specter.

http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=109&session=1&vote=00035

[ChiciB1]

17. I'm Really Getting More & More

P.Oed at Nelson of Florida! Talk about ass-kissing, here's another guy we need to start targeting. He's been so tight with the Repukes lately it makes me want to :puke: :puke:

[AlCzervik]

7. Grassley just invoked the name of Clinton to make a point

this bill is so fucking bad, i've watched this since last week and everyday with each new voted down ammendment it gets even worse.

[Inland]

10. You guys are missing the point.

Huge homestead exemptions don't help the working man: fact is, most people who file bankruptcy don't have one hundred fifty thousand of equity in a house. If they did, they wouldn't be in dire straits. Most of working and middle class America is leveraged: their homes are mortgaged once or twice. The homes are either sold out from under them by the mortgage lender--which isn't affected by an exemption--or they reaffirm the mortgage.

Rather, a huge homestead exemption allows the truly rich to escape. Why do you think OJ moved to Florida? Unlimited homestead exemption. There was an entire NY law firm that went bust and all the name partners took every single pennny they owned and bought the biggest homes in Florida they could sink their money into. For that sort of manuever, however, you need LOTS of money--the junior partners couldn't liquidate everything and move their families.

[flpoljunkie]

12. $125,000 exemption is not enough in today's inflated housing market to

protect older people whose house is now worth more than $125,000. The assets of the rich receive even more protection in the "Bankruptcy Protection Act" than previously, as I understand as they can afford "asset trusts" to sheild their millioins in assets.

The only people protected in this misnamed "Bankruptcy Protection Act" are the banks, credit card companies and the wealthy who can afford lawyers to protect their assets.

[ChiciB1]

16. Wait A Minute... I Live In Florida

and if I'm not mistaken, my Homestead Exemption is only $25,000!

Where is this $125,000 coming from? It sure would be nice to have even that! My taxes have gone up quite a bit in the last few years, however the Homestead Exemption stayed the same.

Is it different for each county???

[flpoljunkie]

18. You are referring to the homestead exemption for property taxes.

This is in regard to filing bankruptcy, something totally different.

[ChiciB1]

19. OOOOOPPPS!

Geez, I can really SCREW UP sometimes! Thanks for the correction.