Bankruptcy bill could result in ‘tsunami’ of filings
Local practitioners predict that a bill currently wending its way through Congress will be passed, granting bankruptcy judges the power to modify home-mortgage terms and prompting a deluge of new bankruptcy filings in Massachusetts.
“I’m expecting a doubling, if not a tripling, of the number of Chapter 13 filings,” said consumer and business bankruptcy attorney Richard N. Gottlieb of Boston. “It’s going to be a tsunami that’s going to hit,” added Gottlieb, who worked in the Boston office of the Federal Deposit Insurance Corp. in the 1990s.
“There’s so much pent-up demand for this legislation that a lot of bankruptcy lawyers and bankruptcy judges are going to have to move very quickly in terms of implementing details associated with this legislation.” Justin H. Dion, a lawyer at Bacon Wilson in Springfield and chairman of the Hampden County Bar Association’s bankruptcy section, was more restrained in his forecast but agreed on the fundamentals.
“I don’t think it’s going to be a catastrophic tidal wave of filings, but from my own practice, I do encounter people who are a round peg in a square hole,” Dion said. “They simply don’t fit into a bankruptcy model. And you will find some of these people who have slipped through the cracks will now finally be able to maybe get restructured mortgages.” …
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by: Julia Reischel
Massachusetts Lawyers Weekly
March 2, 2009