According to the WSJ a handful of local officials in
California who say the housing bust is a public blight on their cities may
invoke their eminent-domain powers to restructure mortgages as a way to help
some borrowers who owe more than their homes are worth.
Investors holding the current mortgages predict the move
will backfire by driving up borrowing costs and further depress property
values. "I don't see how you could find it anything other than
appalling," said Scott Simon, a managing director at Pacific Investment
Management Co., or Pimco, a unit of Allianz SE.
Eminent domain allows a government to forcibly acquire….
Wait, wait…there’s more at http://online.wsj.com/article/SB10001424052702303933404577505013392791018.html?mod=WSJ_hpp_LEFTTopStories
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