Document Type


Publication Date



Negative-equity crisis, Eminent domain, Foreclosure, Mortgage-backed securities, Mortgage crisis, Private-label securitizations, PLS loans, Real estate crisis, Underwater mortgages


Property Law and Real Estate | Securities Law


While it is widely recognized that the mortgage debt overhang left by the housing price bubble and bust continues to operate as the principal drag upon U.S. macroeconomic recovery, few seem to appreciate just how locally concentrated the problem is. This paper takes the measure of the national mortgage debt overhang problem as a cluster of local problems warranting local action. It then elaborates on one form of such action that the localized nature of the ongoing mortgage crisis justifies - use of municipal eminent domain authority to purchase underwater loans, then modify them in a manner that benefits debtors, creditors, and their communities alike.

Publication Citation

Published in: Harvard Law & Policy Review, Vol. 7, No. 2 (2013).