As of Thursday morning, an FM rock-radio advertisement was still warning of financial “vultures” who would swoop into North Las Vegas and seize people’s homes through eminent domain, but a proposal from a private firm to work with a local government to rescue underwater homeowners had already been declared DOA the night before.
The North Las Vegas council voted 5-0 on Wednesday to reject the proposal from Mortgage Resolution Partners that would have had the city use its eminent domain power to seize mortgages from banks and other lenders. The plan would enlist willing homeowners who wanted out from high monthly payments on homes that had lost significant value in the Great Recession housing meltdown; MRP would have financed the plan and received a fee for every house it processed.
Realtors and traditional home finance companies were staunchly opposed, and reportedly spent more than $1 million to kill it. One memorable TV commercial showed raven-like vultures flapping around a cartoon subdivision, an anxious homeowner watching them through the blinds. Although MRP has approached a half-dozen municipalities with the proposal, only one, Richmond, Calif., has entered into a partnership with the company, which has roots in Southern Nevada.
Much of the opposition to the plan, including the vocal opposition from Councilman Wade Wagner, came from concerns about the role of government in the marketplace.
According to the RJ, MRP hopes to entice other local governments, including Clark County or the cities of Las Vegas or Henderson, to consider partnering with the company.