Update: Condemnation of Underwater Mortgages Closer to Reality

more+
less-

It's been a while since we focused on the whole condemnation of underwater mortgages scheme but that doesn't mean the idea has died off.  To the contrary, apparently at least four California cities have now signed advisory agreements with Mortgage Resolution Partners.  According to the Las Vegas Sun and various other news outlets (see here and here), the cities of Richmond, San Joaquin, Orange Cove, El Monte, and perhaps a few others, have entered into an agreement with Mortgage Resolution Partners and are looking to pursue the condemnation of underwater mortgages. 

The first step in the process is for the municipality to offer to purchase underwater mortgages from lenders.  If they refuse, the municipality will proceed with eminent domain actions with MRP to guide and advise them.  However, the plan still faces significant opposition from lenders, financial associations and the U.S. House of Representatives (see here, here, and here).  Just last week, John Campbell, a representative from Orange County, CA, reintroduced legislation to block the use of eminent domain to acquire underwater mortgages.

I can't wait for the next chapter in this saga, namely, what the various municipalities will do when the lenders inevitably refuse their offers... Stay tuned!

Written by:

Published In:

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Nossaman LLP | Attorney Advertising

Don't miss a thing! Build a custom news brief:

Read fresh new writing on compliance, cybersecurity, Dodd-Frank, whistleblowers, social media, hiring & firing, patent reform, the NLRB, Obamacare, the SEC…

…or whatever matters the most to you. Follow authors, firms, and topics on JD Supra.

Create your news brief now - it's free and easy »

All the intelligence you need, in one easy email:

Great! Your first step to building an email digest of JD Supra authors and topics. Log in with LinkedIn so we can start sending your digest...

Sign up for your custom alerts now, using LinkedIn ›

* With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name.
×
Loading...
×