REAL ESTATE: Industry event explores eminent domain
San Bernardino County has created a joint powers authority to explore a proposal to hire a private venture to wrest privately-held mortgages out of investment pools, so homeowners who owe more on their property than it’s worth can refinance or modify their loans.
“If they do this, there’d be a $35 million gain” for the San Bernardino County Joint Powers Authority, Herrera said, commenting: “It’s the first time that we’ve heard that the government agency, partnering with Mortgage Resolution Partners, would receive a financial benefit.”
Inland economist John Husing said he believes the concept needs to be vetted.
He’s intrigued by the ferocity of the attack from lenders on Wall Street over a strategy based on lowering the loan-to-value ratio on the mortgages. “It makes me wonder if they really want to see the numbers come down,” Husing said.
Dorfman on Wednesday warned that a government-led takeover would trigger a backlash from investors around the world who have bought trillions of dollars worth of privately-backed mortgages.
“The losers are tens of millions of American families and workers who deposit money in local banks or global banks, who have 401(k)’s in retirement plans or are saving for a down payment to acquire homes,” he said.