Tim Rood wrote an interesting post today on
Here’s a quick excerpt
Despite a lawsuit and threats from the
securities industry and the federal government to cut off its credit, the City
Council in Richmond, California voted this morning to take another step forward in a plan
to seize underwater mortgages using eminent domain. Richmond has already sent letters to 32
mortgage servicers offering to buy 624 mortgages at the actual value of the
collateral property, often a fraction of the outstanding principal balance. The
intent is to restructure the performing loans to reflect their actual
collateral value and repackage them for sale on the secondary market.
The letters, along with Richmond’s
implied intent to take the mortgages by eminent domain if servicers did not
sell them voluntarily, has prompted a suit seeking a preliminary injunction
against the city filed by Wells Fargo and Deutsche Bank.
…(read more)
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Read the rest of this great post here