Jan 25 2013

LA Times: San Bernardino County abandons eminent domain mortgage plan

San Bernardino County and two of its cities abandoned a plan that would use eminent domain to seize troubled mortgages and write down debt for homeowners.

The decision strikes a blow to an idea that garnered national attention as a potential — if unconventional and controversial — solution to the mortgage crisis.

The proposal was unanimously shot down in a vote by members of the Joint Powers Authority that the county and the cities, Ontario and Fontana, formed last year to explore the idea. Greg Devereaux, county chief executive and chair of the authority’s five-member board, said it gave up on the eminent domain plan because of its lack of public support.

Devereaux also echoed criticisms by the mortgage industry and Wall Street groups, who have argued such a plan would spark lawsuits, higher interest rates and a tightened market for borrowers.

Read the full story here.

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