Academic journal article ABA Banking Journal

Time Enough to Legislate?

Academic journal article ABA Banking Journal

Time Enough to Legislate?

Article excerpt

Congress will be returning soon; the House was set to come back on Sept. 9 and the Senate planned to return to Washington before taking another short break for Labor Day weekend. The pressure of upcoming elections will loom, and the impact of the Presidential scandals on other issues is anybody's guess. Pending matters include:

* Mortgage lending: In late July, the President signed the Homeowners Protection Act. This new law requires private mortgage insurance to be cancelled automatically as soon as a borrower achieves a 22% equity ratio. People with good payment histories whose homes have not depreciated in market value can request cancellation of insurance when they reach 20%.

* Corporate life insurance: For now, the potential taxation of corporate-owned life insurance that threatened earlier this year when Congress was putting together the Internal Revenue Service restructuring law has been dodged for this session. Experts say tax policymakers will likely look at this again in the next Congress.

* Bankruptcy law: Major revisions to the federal bankruptcy code, some of which would help lenders, remain pending. The House passed a pro-lender package in June. The Senate version is out of committee and is expected to reach the floor in September.

* Financial modernization: The House passed H.R. 10, so-called financial modernization legislation, earlier this year-by one vote-over the objections of most banks. The banks consider the rule quite negative. Hearings over the summer in the Senate gathered steam and now Senate Banking Committee Chairman Alfonse D'Amato (R. …

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