California Town Proceeds with Emiment (sic) Domain Plan to Seize Mortgages

This article, written by Krista Franks Brock, brings to light one California town’s totally erroneous application, and possibly illegal, use of the Eminent Domain laws. These plans have been pushed by Mortgage Resolution Partners, a San Francisco for profit LLC, in other cities in the past with no takers. This is not the function of government by any stretch of the imagination. Please read the article below and let me know what you think.

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Despite widespread opposition from the finance industry and the Federal Housing Finance Agency (FHFA), Richmond California, plans to move forward with a plan to use the government’s “eminent domain” privilege to seize homes with underwater mortgages on behalf of homeowners.

Richmond’s city council approved the plan in a narrow four-to-three vote early Wednesday, according to Reuters.

The city will work with Mortgage Resolution Partners, a San Francisco-based company that presents itself as a “community advisory firm working to stabilize local housing markets and economies”—to purchase 620 delinquent underwater mortgages from banks at a discount. If the banks refuse to sell, the city will use its right to eminent domain to forcibly take the properties from the banks, preventing possible foreclosures.

Wells Fargo and Deutsche Bank have already filed a lawsuit to stop the plan.

“Mortgage Resolution Partners is threatening to seriously harm average Americans, including public pension members, other retirees and individual savers through a brazen scheme to abuse government powers for its own profit,” said John Ertman, a partner at Ropes & Gray LLP, the law firm representing the financial institutions.

To read the complete article – please use the link below.

Eminent Domain 

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Tags: Eminent Domain, Foreclosure Prevention

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