Consumer Financial Services Law Blog
Dykema Gossett PLLC
Dykema Gossett PLLC

Consumer Financial Services Law Blog

Consumer Financial Services Law Blog

News and analysis regarding Consumer Financial Services litigation and regulation, and activities of the Consumer Financial Protection Bureau


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Showing 1 post in Eminent Domain.

Renewed Debate Over Eminent Domain Mortgage Proposals

A crazy idea refuses to die: A recently-published report by the Federal Reserve of New York renews the debate over a plan proposed by San Francisco-based Mortgage Resolution Partners (“MRP”) to seize underwater mortgages through an unconventional use of a municipality’s eminent domain power. At least four California cities have tentatively agreed to the MRP plan, including Richmond, San Joaquin, La Puente and Orange Cove. Each of these cities suffered significantly from the collapse of their local real estate markets, but some commentators cite falling delinquency figures to say that the moment has passed for the MRP plan. These cities are not entirely alone. Our readers will recall that several California municipalities (and a number of cities elsewhere, including Chicago) briefly considered MRP’s highly unusual plan to use eminent domain to purchase mortgages. Of course, eminent domain is more commonly (and logically) associated with governmental seizure of land in connection with public works projects. The power is used generally to serve the public good by paying the private party just compensation for the taking. Read More ›