Consumer Law & Policy Blog

Avoiding Foreclosure

Check out this article for publication in tomorrow's Washington Post on avoiding foreclosure.  The on-line version's teaser says: "There are plenty of ways to avoid foreclosure: Refinancing, persuading the lender to modify the terms of the loan, selling the house or filing for bankruptcy protection, to name some. But there are also plenty of pitfalls."  CL&P blogger Ira Rheingold, Executive Director of the National Association of Consumer Advocates, is quoted extensively in the article.

Times Articles on Lemons, Nonprofit Payday Loans, Responses to the Mortgage Meltdown, and More

It's time for another roundup of recent New York Times articles on consumer law, including some articles that don't have anything to do with the mortgage crisis.  On Sunday, the Times ran a piece on cars that had been declared lemons but that were nevertheless resold without being so designated.  An excerpt: 

To see what happens to lemons, Experian Automotive, which specializes in collecting and analyzing automotive data, picked at random 1,000 Florida vehicles that were branded lemons, from a list on a state Web site. Experian found that 555 had been taken out of the state. And four-fifths of those 555 cars no longer had titles branding them as lemons, according to an analysis conducted for The New York Times.

The article also notes that some states require that lemons be so labeled, discusses litigation by those who have unwittingly purchased such lemons, reports on the FTC's failure to act, and quotes consumer advocates as suggesting a national database of lemons is needed.

Today's paper included a report on nonprofit payday loans, while yesterday's included an editorial titled "The College Credit Scam" in which the Times called upon colleges that allow credit card issuers to solicit students on campus to take steps to protect vulnerable students, an issue that is highlighted in the documentary "Maxed Out."  The editorial concluded "Congress, when it convenes next week, should move forward with planned legislation that would tighten federal supervision over the credit card industry while improving disclosure laws and outlawing deceptive practices."

But the mortgage meltdown has also come in for its share of attention.   Last Friday the Times reported here on state statutes intended to limit the damage from subprime lending.  North Carolina, Maine, Minnesota, and Ohio have enacted such statutes and other states are considering them.  And an article in today's paper reports on possible federal responses to the problem.

Info on Most Recent Toy Recalls

U.S. PIRG's Consumer Blog has this post on the Consumer Product Safety Commission's most recent toy recalls, including links to information on CPSC's website.

Presidential Candidates Express Views on Home Mortgage Credit Crunch

Spurred by the rise in foreclosures and the crunch in the subprime mortgage market, the presidential candidates have weighed in with their views and some proposals for reform.  Check out this article in today's Washington Post surveying the situation.  The candidates' proposals, as described in the article, are remarkable for their lack of specificity.  It's hard to know whether that reflects the candidates or the reporting.

More on Taxes After Foreclosure

Credit Slips has this interesting follow-up to yesterday's New York Times article regarding the federal tax bite after foreclosure.  Jeff Sovern blogged yesterday about the New York Times article.

Will the Bankruptcy Laws Change Again?

Today's New York Times has a number of articles on the problems in the credit markets.  Among them is a lengthy piece titled "Loan by Loan, the Making of a Credit Squeeze," focused on the problems of consumers.  In that context, the article discusses attempts to ease the bankruptcy laws. An excerpt:

“The bankruptcy law was written for a different world, and we want to give the bankruptcy courts, and creditors, more flexible tools to work with borrowers to save their homes,” said Senator Richard J. Durbin of Illinois.

In September, Mr. Durbin, the Democratic whip, plans to propose amendments to the bankruptcy code, in a bill called the Helping Families Avoid Foreclosure Act. It would, among other things, permit writing down loans and stretching out payment terms.

Some bankruptcy experts agree that it is time to change the law. “Our bankruptcy laws are not well designed to deal with a massive wave of mortgage foreclosures,” said Elizabeth Warren, a professor at the Harvard Law School. In particular, Ms. Warren said, bankruptcy courts should be able to rewrite mortgages in line with market conditions.

The banking industry, which pushed hard for the tougher bankruptcy law in 2005, wants no easing up now.

Airline Passengers' "Bill of Rights" Endorsed

For what it's worth, The Washington Post has endorsed the airline passengers' "bill of rights" legislation pending before the Congress.  Its aimed at the worst of the problems experienced by delayed airline travelers, such as waiting on the tarmac for hours without adequate food and water.

NPR Talks With CPSC Chair

NPR has been airing some excellent coverage lately about the toys-from-China safety scandal.  This morning, the Diane Rehm Show had a panel of guests to discuss the issue, including Nancy Nord, the Acting Chair of the Consumer Product Safety Commission, and U.S. PIRG's Ed Mierzwinski.   Nord also appeared for a story on NPR's Morning Edition.

Information on Recalled Lead-Paint-Tainted Toys

U.S. PIRG's consumer blog has collected this set of materials related to the massive recall of imported lead-paint-tainted toys.  PIRG's post includes information concerning the inability of the Consumer Product Safety Commission to protect us from dangerous products.  Check it out.

CPSC Product Recalls for July 2007

Here are the Consumer Product Safety Commission's recalls for July 2007.