In California, San Bernardino County and two of its cities last year launched a national debate with a proposal to use eminent domain to take ownership of distressed mortgages and write down debt for the borrowers. The debate returns to the county this week, with the first public meeting on the matter since August. How the plan plays out in San Bernardino, which is the first to consider utilizing eminent domain in this fashion on a wide-scale basis, likely will set the tone for how other municipalities respond to the concept. Critics have warned that such a plan would boost mortgage rates, tighten lending for borrowers with flawed credit, trigger a spate of litigation, and hurt the local housing market. California Mortgage Bankers Association spokesman Dustin Hobbs said the hope in the industry is that San Bernardino will take a different path to help homeowners. "Any proposal involving eminent domain will do more harm than good to the markets," adds Tim Cameron of the Securities Industry and Financial Markets Association. "Put yourself in the position of an investor investing in a product. That is an additional risk, an unquantifiable risk ... and that's the type of thing that causes premiums to go up."