When Standard & Poor's Ratings Services commented on the credit impact of eminent domain proposals to seize mortgages pledged to residential mortgage-backed securities (RMBS) last year, it considered the likelihood of implementation remote.

However, recent developments suggest that the possibility of such eminent domain proceedings has increased, although only in a few jurisdictions. Because of the renewed interest in the plan and more specific discussions involving the city of Richmond, Calif., S&P is updating its views on the potential impact to outstanding securitization trusts, as well as the implications for ratings on future securitizations.

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