RICHMOND (KCBS) – A controversial plan to save homes from foreclosure in Richmond has moved another step closer to coming to fruition.
At a city council meeting on Tuesday, there was heated debate over the plan, which would allow the city to use eminent domain to seize underwater mortgages and prevent foreclosures. Going late into the evening, the Richmond City Council eventually voted 4-2 to set up new guidelines for the anti-foreclosure project.
The council set limits on the potential use of eminent domain, as well as targeted neighborhoods that the program would focus on first.
Most at the council meeting liked the idea of buying underwater mortgages and selling them back to homeowners at current market values.
“If you are working hard, everyday, 40 hours a week, 60 hours a week or more, and you still can’t afford your mortgage, than there is something we need to do about that,” said one concerned resident.
But critics, including real estate agents and bankers, said the program could freeze the flow of new credit into Richmond and do more harm than good.
“I do not know that I am confident in what little information I have been given on this proposal,” said one critic. “When I hear the word eminent domain, red flags go up.”
Many opponents of the proposal have also called it unconstitutional and said they plan to fight it in court if it is approved by the city.
The eminent domain plan has still not been finalized and there will have to be at least one more city council vote before it can be implemented. It is still unclear if the council will provide the necessary five-vote supermajority to actually invoke eminent domain.
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