Subprime Lending

Republican Senators Block Housing Bill; Democrats Vow Fight 

Senate GOP members blocked a proposal on Thursday by Democratic leaders to introduce a second economic relief bill focused on housing reform. The proposal, led by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Senate Majority Leader Harry Reid (D-Nev.), would seek to allow bankruptcy judges to modify the principal amount of a borrower’s mortgage during bankruptcy and would appropriate Federal funds to be used to buy bad mortgage debt.