The Federal Housing Finance Agency’s public expression of “concern” last week about proposals to use the eminent domain powers of local governments to seize performing underwater mortgages might be enough to significantly delay or even derail the effort outright, say experts. The conservator of Fannie Mae and Freddie Mac and regulator of the 12 Federal Home Loan Banks warned that unspecified “action might be necessary” on its part “to avoid a risk to safe and sound operations” at the government-sponsored enterprises. “FHFA has significant concerns about the use of eminent domain to revise...