Tuesday, April 23, 2013

heads up from ALTA...eminent domain considered for underwater mortgages.....that's CRAZY!!!!

ALTA Joins Coalition Opposing Use of Eminent Domain for Underwater Mortgages
A private investment firm is working to set up deals in Richmond, California, and North Las Vegas, Nevada, asking the cities to use eminent domain to buy out underwater mortgages. Under this scenario, the private investment firm, Mortgage Resolution Partners (MRP), would then resell the property. The concern is that the properties will be undervalued and the original investors that own the mortgages are left holding the bag. Last week, ALTA joined a coalition of industry partners in opposing this Advisory Services Agreement.
The California letter is available here and the Nevada letter can be read here.
The coalition stated, “We believe that the MRP proposal raises very serious legal and constitutional issues. No jurisdiction has ever used eminent domain to acquire underwater mortgages in securitized pools. Such a novel use of the eminent domain powers is unprecedented and would, in our view, not survive the multiple legal challenges that would ensue.”
For more information on this issue, please contact ALTA’s director of state government affairs, Madeleine Nagy.

No comments: