No good can possibly come of this – a plan by a city in California to use eminent domain to “save” underwater mortgage home owners.
First: it’s too complicated. Complicated plans never work out as they’re supposed to and this plan is SUPER complicated.
Second: it’s eminent domain. There is absolutely nothing, ever, in any way shape or form that is in any way possibly even remotely good about eminent domain.
As a concrete example of the first point, note that one of the main investors who will be severely hurt if the plan goes though is CalPERS, California’s public employee retirement investment fund. And why is this bad? Well, for starters, because many of the people who own these homes receive CalPERS benefits!!! So while some of these people might end up with a better mortgage, they might not be able to pay it because their retirement benefits are destroyed.