Richmond, CA, Plans To Seize Underwater Mortgages

Bold move to put the city itself underwater

Richmond, California's leaders approved on Wednesday morning a plan for the city to become the first in the nation to acquire mortgages with negative equity in a bid to keep local residents in their homes.

The power of 'eminent domain' allows governments to seize private property for a public purpose. Critics say the plan threatens the market for private-label mortgage-backed securities.

Richmond's city council voted 4 to 3 for Mayor Gayle McLaughlin's proposal for city staff to work more closely with Mortgage Resolution Partners to put the plan crafted by the investor group for the city to work.

Comments

[UnCivilServant]

If you bought more home than you can afford, don't use the most abominable power to try to rob the bank of it!

[Sevo]

And the SF city gov't isn't about to let Richmond take the gold in the 'stupid econ' competition; SF is considering the same thing.
In SF, the market has not only recovered, it's something like 10% over the highest. So there's really only one way to be upside-down in SF RE: using the property as a piggy bank.

[johnson29]

The right mortgage should be based on your capacity to pay on time and you to choose a good mortgage is very important since this is a long term commitment. Make sure you find a mortgage service with small interest rates. If you want to find a simple service that will find the lower lowest rates .
HECM California