Ditch the 2005 Bankruptcy changes wholesale? Yeah, probably.
Some part of the default rates on mortgages (we don't know how much, because the government isn't collecting statistics systematically) is related to changes in the bankruptcy code, brought under Bush and supported by Blue-dog Democrats.
Depending on the median income of your State, one may not be able to walk away from credit card debt, leaving the mortgage as the next likely stress point.
As the world turns:
One bankruptcy lawyer told me that MBNA (now part of Bank of America) had pushed hardest for the changes, and estimated that the new law would enable it to extract an extra $100 a month from consumers who declared bankruptcy, which would increase their profits by $85 million.
In a bit of schaudenfreude, it looks like the new rules may have increased the profits of their credit card business at the expense of their mortgage business,...
