This article appeared in the July, 2012 PAPER SOURCE JOURNAL (https://papersourceonline.com/paper-source-journal/infosubscribe/):
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.
The municipalities, about 45 minutes east of Los Angeles, would acquire underwater mortgages from investors and cut the loan principal to match the current property value. Then, they would resell the reduced mortgages to new investors.
More from the Wall Street Journal: http://online.wsj.com/article/SB10001424052702303933404577505013392791018.html
