Eric Nguyen ’09 has just had a paper published in the American Bankruptcy Law Journal about how hard parents fight to keep their family homes in times of economic distress.
“It is extremely rare for a student to publish a work other than a student note or comment,” said Professor Elizabeth Warren. “It is even more unusual to publish in the leading peer-reviewed journal in a field. But Eric did just that: he wrote a superb paper, submitted it for peer review, and was selected to publish in the premier bankruptcy journal in the country. It’s an amazing feat.”
Families buy homes as a way to buy opportunities for their children – they pay a premium to maintain a home in a good school district, says Nguyen. As a result, the potential loss of a home due to a mortgage crisis is more painful to families with dependent children.
“Homeownership is an especially important value because it affects children,” concludes Nguyen. “Parents who filed for consumer bankruptcy…went out of their way to save their homes, even when their incomes were far outpaced by those of non-parents. If we want to encourage continuing, sustainable homeownership, the law should be flexible enough to provide mortgage relief to debtors who will regain their financial health.”
As Nguyen’s paper states, there are no legal protections specifically designed to aid families in crisis. The law does make it possible for certain people to restructure financial arrangements, such as those who own luxury items like boats and vacation homes.
Several bills aimed at aiding families facing bankruptcy have been introduced in Congress, but all have been stalled. Most recently, Senator Durbin introduced a bill called The Helping Families Save Their Homes Act, which would provide homeowners the opportunity to ask a judge to modify the terms of their mortgage. The Senate has not acted on the legislation since its introduction in April.
Read Nguyen’s full paper, “Parents in Financial Crisis: Fighting to Keep the Family Home.”