Mortgage Threat From Hedge Funds Irks Democrats

By BARRY MEIER

Several Democratic lawmakers lashed out Friday at hedge funds that have threatened to block attempts to renegotiate mortgages for struggling homeowners.

At least two funds, Greenwich Financial Services and Braddock Financial, have told banks that they may take legal action if loans are renegotiated in a way that hurts the funds’ financial interests.

Many hedge funds have purchased securities backed by mortgages. The New York Times reported Friday that Greenwich Financial and Braddock Financial, and possibly other funds, were resisting attempts to renegotiate the loans.