NORTH LAS VEGAS (KSNV MyNews3) -- Those who own a home in North Las Vegas -- and owe more than it's worth -- may soon be dealing with a controversial proposal that could have the city seizing the underwater mortgage.
Cliff Coleman is retired, raising a grandkid and owes more money on his North Las Vegas home than it's worth.
While times are tough, Coleman wants nothing to do with a proposal that would have the city use eminent domain to take underwater mortgages and refinance them.
“I don't think the city needs to be involved in taking over homes because they might not give them back,” Coleman said.
But Mortgage Resolution Partners, the company trying to sell the City Council on the idea, says homeowners only benefit.
Company officials say homeowners volunteer getting a lower mortgage, which allows them to stay in their homes.
So our program talks about always allowing the homeowner to retain that home ownership,” said Steven Gluckstern, Chairman of Mortgage Resolution Partners. “We never want them not to own their home. It would be working with their mortgage, an existing mortgage or a new mortgage, to allow them to be able to remain there with a correctly priced mortgage.”
The Greater Las Vegas Association of Realtors argues lenders lose out big, and so may homeowners.
“Their intention is to help underwater homeowners and we understand that,” said Sean Fellows of GLVAR. “However the way that they're doing it using the government's sacred eminent domain power, There's a lot of questions because once that property is taken from somebody who's to guarantee that it will go right back to them.”
Mortgage Resolution Partners says it does have contracts with other U.S. cities but says it has yet to actually acquire a mortgage, so success of the proposal has yet to be seen.
The City Council had several concerns about the plan and voted to hold a workshop in the next 30 days to answer the many questions they still have.