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In Their Own Words: Why Dem Senators Screwed Homeowners

Only 45 Senate Democrats voted Thursday to oppose the banking industry and pass legislation aimed at stemming foreclosures.
 
 
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Only 45 Senate Democrats voted Thursday to oppose the banking industry and pass legislation aimed at stemming foreclosures. The bill would have allowed bankruptcy judges to allow homeowners who met strict conditions to renegotiate mortgages -- a process known as cramdown. It would have only applied to mortgages entered into before 2009.

Earlier in the week, the measure's lead proponent, Sen. Dick Durbin (D-Ill.), concluded that banks "frankly own the place."

Of course, the 11 Democrats who voted "no" have a more charitable view of their own motivations. So we asked them what their reasoning was. In their own words, here is how (those we could find) explained their vote:

Byron Dorgan (D-N.D.): "A number of things. I thought the 31 percent is an arbitrary number. I think there are a whole lot of folks, are likely folks, out there who have little debt outside their home who could -- I just thought it was an arbitrary number and I didn't like the way it was constructed."

Dorgan is referring to the percentage of a person's income that a judge could determine should be dedicated to paying the monthly mortgage. The figure is roughly in line with what financial analysts agree is appropriate.

Is Durbin right? Do banks own the Senate?

"I don't know who he's speaking about," said Dorgan. "He worked on this for a long, long time. And I wish they would have found a way to reach an agreement that would have allowed the legislation to get through...I don't know the context of which he said that."

Is the bill totally finished? "I don't know. I think I wish they had found some middle ground by which they could have moved a piece of legislation. They didn't do that. And you know, this legislation went well beyond subprime, as you know."

 
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