A controversial plan to save underwater borrowers has been blocked.
MPA reported in July that Mortgage Resolutions Partners (MRP) was working with the city of North Las Vegas on a possible eminent domain plan to save underwater homeowners. The plan would see the city negotiate to buy notes on targeted, underwater homes at what they believe to be fair value, using the governmental power of eminent domain to acquire the loan from holders who were hesitant to sell.
But the Las Vegas Sun has reported that the North Las Vegas City Council has rejected the proposal, instead deferring to the state of Nevada to weigh in on the plan's legality. North Las Vegas mayor John Lee said the city did not have the resources to vet the proposal by MRP.
The plan, and others like it proposed by MRP in other hard-hit housing markets, drew the outrage of the mortgage industry. A similar plan proposed by MRP is still on the table in Richmond, Calif., and the Association of Mortgage Investors strongly condemned MRP's role in such plans.
"Mortgage Resolution Partners is not Robin Hood. MRP is a for-profit business that runs an investment fund."