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Paul Kiesel
Paul Kiesel
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Questionable Housing Relief Data – Foreclosure Rate Likely Higher

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The most recent data released on the number of subprime mortgage borrowers who’ve received help by lenders over the last few months, is likely dubious in its accuracy or its detail. And, unfortunately, those details are key for regulators to gauge the severity of the housing crisis; also, it impairs the ability to understand what type of help these borrowers need and what type of response is appropriate.

Based on data collected from nine of the country’s largest banks, a report issued by the Office of the Comptroller of the Currency suggests that the foreclosure rate is actually higher than the numbers being reported by groups such as the Mortgage Bankers Association (MBA). The MBA, in all likelihood, would like to curb the perception that the market is worse than they think it is, but they aren’t helping any party in the long run, particularly if they continue to distort the truth or numbers that accurately reflect market conditions.

Unfortunately, a program like Hope Now, which is not fully equipped, anyway, to handle all of the troubled mortgages and pending foreclosure, is reporting data that inflates mortgage relief, when in actuality the program has had less of an impact than originally expected; and this would make sense as many of the reports from borrowers and third party groups have been issuing underwhelming support for the White House sponsored program.

Even though the MBA argues that their numbers get you “in the ballpark” of what is taking place in the housing market, it needs to be more precise in order for troubled borrowers to receive more accurate and responsible help — something they might not have initially received when signing off on the loan.