Capito and the Cramdown

With Congress weighing an Obama administration proposal "to change existing bankruptcy laws in an attempt to cut down on the number of foreclosures," The Journal of Martinsburg counts Rep. Shelley Moore Capito, R-2nd, among those questioning the measure.

Capito "and three other ranking House members expressed their concerns about the measure in a recent letter to Treasury Secretary Timothy Geithner," the article said. "Among other things, lawmakers said in the letter that the bill could have long-term implications for taxpayers, who might be left with sizable liabilities if federal loan programs through the Federal Housing Administration, U.S. Department of Housing and Urban Development and Department of Veterans Affairs are not excluded from the measure."

A key sticking point is the plan's "cramdown" mechanism, which "would change laws relating to Chapter 13 bankruptcy filings and enable courts to force a loan's principal to be decreased," the Martinsburg newspaper explains.

Supporters cite the rising tide of foreclosures. "Recent figures indicate that there are nearly 9,000 foreclosures per day nationwide. In Jefferson County alone, the number of reported trustee sales has increased from 73 in 2005 to 672 in 2008," The Journal reports. "In Berkeley County, the number of reported trustee sales has increased from 62 in 2005 to 504 in 2008."

The Charleston Gazette presents a statewide perspective.

"Between 1991 and 2002, West Virginians were less likely than the average American to be more than one month late on their mortgage payments," that article said. "But now, West Virginia, like most states, is facing rising number of delinquencies at foreclosure stage. "

Specifically, the Charleston newspaper's research found that "West Virginia's three-month delinquencies were the 14th highest in the nation," and "the state had the nation's seventh highest prime mortgage delinquency rate and the seventh highest subprime delinquency rate."

The Gazette also provides graphics to illustrate subprime mortgages and delinquency rates.

The Los Angeles Times also has coverage, and notes the letter co-signed by Capito. The Obama administration, meanwhile, offers several explanatory links.