On January 6, 2009, Senator Dick Durbin introduced the Helping Families Save Their Homes in Bankruptcy Act of 2009, which would amend the bankruptcy code by allowing judges to modify the terms of primary residence mortgage loans during bankruptcy proceedings. On January 8, 2009, Senator Durbin, along with Congressman John Conyers, Senator Chris Dodd and Senator Chuck Schumer announced that an agreement was reached with Citigroup to support the legislation, provided that certain changes are made, including restricting the eligibility to mortgages in existence as of the date of enactment. This is one of a series of bills expected to be introduced in the House and Senate to assist homeowners and prevent foreclosures. Senate Release. Proposed Bill. Citigroup Legislative Support.

On December 22, 2008, the Office of the Comptroller of the Currency and the Office of Thrift Supervision reported in their Mortgage Metrics Report that despite the growth of loan modification as a loss mitigation strategy, delinquencies and foreclosures continue to rise, with 55 percent of the modified loans becoming 30 or more days delinquent after six months. OCC and OTS Report.