ABC’s “World News with Charles Gibson” reported foreclosure statistics furnished [1]by RealtyTrac, a commonly used barometer of the real estate market, on its June 12 broadcast. “Today we learned that more than 176,000 home foreclosures were filed last month,” said Gibson. “That is more foreclosures in one month than have ever been filed before. And it’s 90 percent higher, almost double the number filed in May of 2006.”
However, the data furnished by RealtyTrac, including the data furnished in the ABC report, are often subject to misinterpretation, according to Rick Sharga, vice president of marketing at RealtyTrac.
Sharga [2]told The (Newark, N.J.) Star-Ledger “the company decided to fine-tune its figures because too many people – including the media – were misinterpreting the foreclosure numbers.”
According to the Star-Ledger story, the data supplied by RealtyTrac count every step in the foreclosure process separately, which in some localities could be as many as three to four steps, thus counting a single foreclosure up to four times. The June 12 issue of The Star-Ledger reported that starting as early as next month, RealtyTrac would fine-tune its data and publish the number of unique filings in addition to its current report of new filings.
That would make a huge difference, the Star-Ledger’s Sam Ali wrote.
“The change is expected to dramatically decrease the number of foreclosures in any given state, according to RealtyTrac,” Ali wrote. “Under the change,
This report didn’t prevent ABC News from running a story about the RealtyTrac numbers.
“After a break in foreclosures in April, real estate analysts thought they were seeing a promising sign, but not so,” said ABC’s David Muir. “The number of foreclosures is roaring back. This is when the real estate market is supposed to pick up.”
Muir blamed lenders for the spike in foreclosures. “What’s behind it?” said Muir. “Thousands of homeowners lured in by those easy-to-get mortgages, even if you had little cash and poor credit.”
Sharga, who had admitted his own numbers could be flawed, was featured in the ABC story and said “there were a lot of exotic and it turns out, fairly toxic loan types that were out in the marketplace over the last couple of years.”
ABC offered several examples of people who lost their homes to foreclosure; however, they tended to be indicative of cases of financial irresponsibility and not necessarily signs of a struggling economy.
“I would work with the electric company and pay a month late,” said Lori Johnston, a foreclosed homeowner with a second mortgage in Richardson, Texas. “But, then I would be a month behind and that next bill would be due. It just … snowballed.”
One source the ABC story cited was a real estate broker who specialized in foreclosed properties. He placed blame on the industry and not the ones who defaulted on their loans.
“I know that it’s heartbreaking to have home ownership or the dream of home ownership and then you get it and lose it,” said Kenneth Sessions, an Oakland, Calif., real estate broker. “But, I believe that a lot of these people were put in these properties that they couldn’t afford from day one.”
ABC News has even gone as far as [3]posting a Web site seeking those who are struggling with their home loans. The site provides a form for contact information so an ABC News producer could contact them.
This is just [4]the latest example of the media’s blaming lenders and not individuals for overly risky borrowing.