Oppose SB 0850/HB 1346:“Prohibition on Acquiring Mortgages or Deeds of Trust by Condemnation”
aka “ The Predatory Lenders Protection Act”
This bill is moving ahead in the Maryland General Assembly and we need to stop it! SB0850/HB1346 would change longstanding state law to prohibit an innovative local solution to the foreclosure crisis, before it is even debated by local governments. 
Foreclosures are up in Maryland! But SB0850/HB1346 would do nothing to protect homeowners or communities who have been hardest hit by the foreclosure crisis. It only serves the agenda of lobbyists for the major banks who engaged in predatory lending and their allies to shut down a debate that they don't want to have! Please take action!
Please call delegate McIntosh, Niemann and Robinson. Tell them SB850/HB1346 is really a “Predatory Lenders Protection Act” and urge them to oppose it:
Maggie McIntosh , Chair of Environmental Matters and Sponsor SB850/HB1346
Doyle Niemann , Chair of Housing and Real Property Subcommittee
Shane Robinson , Co-sponsor SB850/HB1346
Why we oppose SB850/HB 1346
· Maryland has one of the highest foreclosure rates in the country.
· The bill seeks to make it impossible for cities to consider adopting Local Principal Reduction (LPR)programs.
· In a Local Principal Reduction program, the city works with private investors to acquire a set of the worst, hardest to fix underwater mortgages (especially “Private Label Securities” or PLS loans that often have predatory features and refinances them to restore home equity. If banks refuse to cooperate, cities may use their legal authority of eminent domain to buy the bad mortgages at fair market value and then reset them to current value. In Baltimore City alone, nearly 13,000 homeowners are stuck with predatory PSL loans.
· No Maryland city has yet voted on or even introduced a Local Principal Reduction program. There is no reason for the legislature to act hastily. The mortgage industry just wants to shut down even consideration.
· Because many predatory loans have been bought and sold in pieces in complicated transactions on secondary mortgage market, cities may need to use their constitutional power of eminent domain to help free loans from “PLS trusts” even when servicers, trustees, and borrowers all agree on the sale of a loan. But SB0850/HB1346 would make even this voluntary use of eminent domain to fix bad loans illegal.
· While in the past the power of eminent domain has been sometimes used to push poor and working class people out of their homes, this (potential) use of eminent domain could keep families in their homes by helping them escape the underwater predatory loans that were particularly marketed to African American communities. The legislature should not single out and ban a program aimed at saving families from foreclosure.