Bankruptcy Group Seeks CARES Act Changes to Avoid Foreclosures

The $2 trillion coronavirus relief measure must be modified to avoid “millions of foreclosures” and greater financial distress from the coronavirus, a group of bankruptcy professionals said.

Gaps in the Coronavirus Aid, Relief, and Economic Security (CARES) Act leave borrowers and debtors vulnerable, the National Bankruptcy Conference said in a letter to House and Senate leaders.

The CARES Act allows homeowners with loans backed by federal government entities like Fannie Mae, Freddie Mac and the Federal Housing Administration to ask for up to 180 days of loan forbearance. They can then ask for an additional 180 days if they are ...