We’ve covered this topic before (see here, here, and here), but we haven’t heard much about it lately. But thanks to this new article by colleague Dwight H. Merriam, we can get back up to speed.
In “Eminent Domain for Underwater Mortgages: Already on the Way to the Bottom of the Sea of Bad Ideas,” from the Virginia State Bar’s Real Property Section’s journal, The Fee Simple (Spring 2015), Dwight discusses “the foreclosure crisis and how so many homeowners became victims of bad lending practices and a deep economic recession. Many are stuck in their homes, which are underwater with a value far below what was owed on them.” The article explores the question: can eminent domain bail out underwater mortgages?
Short answer: no.
To learn more, click here to view the article.
And what’s the latest that Richmond, California, which was leading the charge on using eminent domain to condemn underwater mortgages (before reality set in) is up to? The city has turned to its latest enterprise, residential rent control. Just the thing an ailing municipality needs. As Sonny and Cher put it, the beat goes on.