The Banksters Push Back Against Richmond

By: Saturday August 31, 2013 10:30 am

The banks are pushing back hard against the city of Richmond, California, as Richmond tries to help its homeowners get out from under mortgages that are seriously out of whack compared with actual property values. First the banks filed suit to stop Richmond, and now they’re telling their investment clients to steer clear of Richmond’s municipal bond offerings.

Shorter bankster: “Nice city you’ve got here, Richmond. It’d be a shame if anything were to happen to it.”

But Richmond still has one powerful weapon in their pocket, that scares the banks to death . . .

 

Eminent Domain Threat May Force Banking Practices Into Full View

By: Saturday August 10, 2013 9:06 am

The city of Richmond, California, is faced with a mountain of homes where the owners are seriously underwater in their mortgages. The banks and investors who hold the mortgages have refused to adjust the terms of the loans in any meaningful way, and Richmond is worried that a wave of either foreclosures or walkaways will result in Richmond becoming Detroit West. Their solution: they want to buy the loans and then rework the terms for the owners to something more realistic. The banks, as you might guess, don’t want to sell.

Richmond is threatening to invoke eminent domain, to force the sale, and the banks are filing suits to block this. But the banks ought to be careful about what they are wishing for. Why? I’ll give you the answer in a single word . . .

Financial Services Industry Threatens Retaliation at Municipalities Who Use Eminent Domain to Fix the Housing Crisis

By: Friday July 20, 2012 9:41 am

The financial industry is taking another run at a plan to help homeowners, this time the proposed program in San Bernardino County that would use eminent domain laws to acquire underwater mortgages and then refinance them for borrowers at market rates. The financial services lobbying group SIFMA said they would exclude mortgages in San Bernardino and other localities that engaged in this tactic

White House Has Concerns With Eminent Domain Proposal

By: Thursday July 19, 2012 6:41 am

The bid by the private company Mortgage Resolution Partners to team with municipalities and use eminent domain laws to purchase underwater mortgages and then refinance them at a discount to the borrower has generated lots of attention at the wonk level. Now the White House has weighed in, and expressed skepticism.

Rep. Brad Miller on Using Eminent Domain to Reset the Housing Market

By: Friday July 13, 2012 1:43 pm

The reason I initially contacted Rep. Brad Miller today was to discuss an issue that has come into vogue this week as a potential solution to the housing crisis. San Bernardino County is considering a partnership with Mortgage Resolution Partners on a scheme that would condemn underwater mortgages through the process of eminent domain, and then refinance those mortgages with the borrower. If it works, this would save the individual borrowers tens of thousands, if not hundreds of thousands, of dollars and remove the vulnerability of being underwater; provide an economic stimulus to struggling municipalities; and provide MRP with a tidy profit on the new mortgage, after buying the old mortgage at a large discount through eminent domain.

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