Richmond hopes to seize mortgages of up to $1.1 million through eminent domain

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Some 43 of the mortgages the city of Richmond, Calif., plans to acquire through eminent domain have balances of more than $600,000, the Wall Street Journal reported.

The largest mortgage has a balance of $1.12 million and the city has offered nearly $680,000 to purchase the loan out of a mortgage-bond pool originally issued by now-defunct lender Countrywide. The second-largest loan the city would buy has a balance of $962,307 and the third, $888,361, the paper said. The median loan balance is about $380,000.

“The hefty price tag for some of these loans could complicate the argument made by Richmond city officials that they need to seize the mortgages to help homeowners who owe more than their homes are worth, putting them at risk of foreclosure,” the Journal said.

The high mortgage balances “shows that this is not necessarily a rich-versus-poor or a have-versus-have-not situation,” analyst Marc Joffe told the paper.

Source: Wall Street Journal

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