Mortgage companies & banks take eminent domain $$$$

Filed under:News coverage — posted by admin on June 20, 2009 @ 6:53 pm

dollarsbigpile

THIS IS A MUST READ FOR LANDOWNERS:

Those of you facing eminent domain, fighting hard for those measly dollars that utilities will cough up, well, what many people are finding is that the mortgage companies are grabbing it, leaving them with nothing.

If you are a landowner and if CapX 2020 is threatening to take some of your land, QUICK, get out your mortgage and see what it says about landowner compensation for eminent domain takings or eminent domain settlements.

One thing this article doesn’t address is whether there’s a pattern based on percentage of equity, i.e., are they taking the cash when someone’s upside down, but if the mortgage balance is 20% of the value they don’t, if it’s a new mortgage or one regularly behind do the take it, and if it’s one with a substantial down payment and prompt payments they don’t… What’s the pattern here?

From Friday’s STrib:

Government takes land, banks take cash

In tough economic times, more homeowners who lose ground to eminent domain are finding that stressed mortgage holders are pocketing the proceeds.

By MARIA ELENA BACA, Star Tribune

Harold and Sharon Tieden were unhappy from the outset that they would lose a 12-foot swath of their Blaine back yard and a row of mature pines to an expansion of Radisson Road. Still, they began negotiations with Anoka County, planning to use the settlement to rebuild a berm, move trees and rocks, and maybe build a fence. ΒΆ But like many other homeowners losing ground to eminent domain this year, they have found that they can’t even count on the cold comfort of a settlement check.

When they sign the papers, the check, it turns out, will likely go instead to their mortgage holder.

In an unusual twist brought about by stressed lenders and highly leveraged real estate, homeowners across the metro who are facing the loss of land due to eminent domain projects are increasingly getting notices from banks claiming rights to the proceeds. In the past, such notices were sent so rarely that county officials never saw a need to keep track of how often it happened.
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