Imagine that the Media Using Inflated Foreclosure Numbers

Stephen- it sure appears that way.

Al- Glad to do it.

Paul & Michelle- bad press sells

Tom- so true

Paul- great info- so it's even more off than I thought.

Gary- it's so hard to know.  I wish I knew where we could find accurate info.  I don't know if anyone knows where to get it if you look at the stats the government uses on a plethora of areas they are always revising them by quite a bit.  I would imagine that you have your hand on the pulse of your market so you know if there are a high level of foreclosures that's info you should be sharing with your local market.  We have got to let the public know that real estate is local not national and last I checked those national headlines aren't about my market in Kansas City!

John, I had to stop to think about what you said about their business- they are selling a service to sign up for to get foreclosure information so if the numbers are higher that could equate to more people signing up- so I would agree with you.  The problem then lies with the Media and Congress turning to them for data (hopefully) thinking that data is correct.  I guess we'll see if they go away from this source in the future now that this info is out there.

Joe- agreed

Carmen-That's great make sure you are sharing that info with your local media and if they don't start using the accurate numbers maybe a marketing campaign about it could give you a lot more credibility with the consumers in your market.

I do a radio show in my market where we try to get to the bottom line on what the real situation is.  It is very difficult to find accurate data to share with my listeners.

Tracey, I think you're onto something there. It does look like Lindsey Lohan is doing her best to divert that attention to her.

Jennifer, you're right negative sells, if you are a lying dog what does that make me?  Mortgage folks are ranked lower than agents with all this fiasco going on I think we are both ranked lower than used car salesmen too.

Bill,

First, I don't mind people calling me out on my posts, I actually like the chance to clarrify my points, but I wonder if you are confusing my post with others you have read?

Did you miss this part of my post? "I am not trying to understate that there is a problem with foreclosures because there is, I just don't think that it is nearly as bad as everyone is saying."

I have never denied that there is a problem because there is.  Not sure where you got your median house price info for my market- that is the median price for New Construction our overall median price is down about 2.1% to $157,000 certainly not a meltdown, but a correction nonetheless.

The media keeps comparing everything to the last four years- which is fine, but they also need to address the fact that the last 4 years were by far the four best years in HISTORY.  I am guilty of this because I continue to compare my favorite MLB team The Kansas City Royals to the 1985 Royals that won the World Series- it's pretty tough for them to live up to MY standards.  The only way they can live up to my standards is to win it again and if they want to exceed my standards they have to win two in a row and then three in a row, and then maybe they will have to go undefeated AND win the series again.  So when you hear me complain about my Royals you need to understand my frame of reference is 1985 when they reached the pinnacle of their sport.

In May 2007 foreclosures hit their peak (at least so far they came down a little in June-Notice I didn't say they are coming down for good) but the high in May 2007 was the same level as December 2003- come on now was 2003 a bad year for foreclosures?  I don't recall hearing anything about foreclosures in 2003.  I am not trying to ignore the fact foreclosures are on the rise, I am just trying to put things into perspective.  We are not facing the end of the world and face it for many folks (at least in my area) now is a great time to buy as long as you understand real estate is not a get rich quick scheme.

You said:

I'm looking at preliminary data right this minute that shows Kansas City, MO during the period of January to June of 2007 had just under 5000 homes in some level of foreclosure, meaning that there are a LOT of homes that are 60-90 days past due on their mortgages. Does this concern you, or is it easier to say the media is flat out wrong? Yes it does concern me, we have tried to help through education and getting people to WAKE up before the problem gets worse.  What I want to know is exactly where I said the media was flat out wrong? Where have I denied there is a problem? I have said they that use negative headlines to sell papers/ads/ whatever they need to sell to be successful.  I have given examples of them turning a positive statement into a negative one so I am not sure where you are going with this.  I have now said that they are quoting sources that appear to be using inflated numbers- do you dispute the possibility they are using inflated numbers?

Do you think the media should be quoting sources of information that are apparently inflating numbers?  In your research did you see how many of those folks that are behind have enough equity that they will likely find a way out of foreclosure?  Do you know what percentage of the delinqencies were due to job loss or to over buying with an improper financing structure?  I don't have the answers to these questions I wish I knew where I could get ACCURATE information about it because that is what I would focus on.  There is opportunity in EVERY market if you know where to look and I am trying to help the consumer realize that.

You said:

If anything, it should give you an idea that a lot of people are in trouble; there is no way to refute that. Where have I refuted that? Where have I said every thing is great that there is no trouble.

You said:

What do you think will happen to a neighborhood if only 20% of those homes enter our inventory pool as bankowned properties, or maybe something not as serious like a short sale? or maybe just a desperate seller that will walk away with equity but has to get out now? All have a downward effect on price, until we get other buyers and investors into the homebuyer pool.

I know what will happen to values as those things happen, I am trying to do what I can to prevent that in the future through my website, my radio show, through the posts I do here and on my own blog- there isn't a whole lot I can do for people that are already in trouble see lenders don't like reactionary people so unless you have a lot of equity once you get behind on your loan you are basically screwed unless you can pull yourself out.  That's why we focus on being PROACTIVE when you buy, sell or refinance so they are ready for the unknowns of life.

Isn't what I am saying in my posts designed to help people realize what is actually going on in the market and unfortunately there is blood in the streets in the real estate market, but the best time to buy is when there is blood in the streets so I am trying to get people out there to help stop the bleeding.

If fewer people can buy due to affordability and the credit crunch won't there be more renters?  Doesn't that help the investor market so why not show your good solid clients those opportunities and you can help the market in many ways- buy properties NOW, rent them out, help those tenants to rebuild their credit by working with a strategic mortgage partner that has a system set up to do just that.  Then in a year or two you have a buyer that has righted the ship and can help themselves out and buy real estate.

You said:

Now I'm certainly not a doom and gloom guy, as my business is doing great because I'm diversified enough to have buyers and sellers at all levels of the spectrum, so let's take this opportunity to educate ourselves further, and share that knowledge with our industry as well as our communities!

Where in the information that I have been posting am I not living up to this? 

If you have read some of my other posts you should see that we have a system we take our clients through that would prevent an overwhelming majority of these foreclosures because we don't follow tradition and we actually put the client in a much better financial position to handle the "Normal" causes of foreclosure- job loss, disability, divorce, death of a spouse, etc. See in my practice my clients don't have to worry about being in loans that they can't afford from the outset or loans that will explode on them so we just have to focus on the other threats to the wealth they have inside their houses.

Bill,

No problem, it happens.

I am concerned that foreclosures will go up too, I just think that when the media inflates bad news and making it sound worse than it is it will do more damage because people will stay out of the market longer.  I am all for giving the public accurate information even if it is bad.  Once they can get their hands around the info they can then act in way that can benefit them.

I also think that some of the factors you stated about the situation potentially worsening could be offset by rates coming back down.  The inflation numbers are getting into the range where the Fed is comfortable with lowering rates.  If that happens then those lower rates will likely help to offset some of those foreclosures.  I know that is speculation and that is something I am not necessarily sharing with clients I don't want to fill them with false hopes.