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Thread: Could seizing a home save a homeowner?

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    Could seizing a home save a homeowner?

    Could seizing a home save a homeowner?

    Could seizing a home save a homeowner? - Yahoo! Homes
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    Re: Could seizing a home save a homeowner?

    I think the bankers objections are valid. Think about it if you were the banker, making decisions to lend, or not, in this community. You would think your risk had just increased, and would tighten lending. This would hurt the community by further driving down prices, demoralizing other homeowners, and thereby increasing the number of distressed loans.

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    Re: Could seizing a home save a homeowner?

    Quote Originally Posted by radcen View Post
    Could seizing a home save a homeowner?

    Could seizing a home save a homeowner? - Yahoo! Homes
    As I understand it, in a nutshell, municipalities would use imminent domain to more or less facilitate the foreclosure process. They'd pay the lender the current market value of the home (on properties where the mortgage is current but the homeowner is underwater), the lender takes a bath -- but less of a bath than he'd take if he had to foreclose -- and then the municipality will hold the paper on the home until Mortgage Resolution Partners could arrange a mortgage for them.

    I think it's great. And I'll tell you why:

    Banks are doing an absolutely crappy job of helping homeowners. They've received hundreds of millions of dollars from taxpayers to help them through this disaster. And they can't move fast enough to get the housing market on its feet again. They're inept. They make decisions by committee. And they can't even respond to bona fide offers on their for-sale-in-foreclosure properties.

    Actually, I think they should do it for anyone who's just beginning the foreclosure process. It would be a Godsend.
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    Re: Could seizing a home save a homeowner?

    Eminent domain poses a unique opportunity. But to use eminent domain powers, municipalities must prove that there is a public benefit, something legal scholars question.
    Hence one of the dangers of eminent domain. Once we're of the mindset that "whatever benefits the public" goes, even if it includes property rights and negating individuals' contracts with one another, we're in a bad way. "Does it benefit the public" can be argued in virtually any direction at all. It's like the general welfare argument or the Pandora's Box that is the commerce clause. Life, liberty and property should be the hardest rights in all the land to ever deny, even through due process, unless there is a criminal reason for doing so.

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