Foreclosure Properties: Bill to Have Centralized Data

An up-to-date centralized reporting mechanism on foreclosure properties and loan modifications across the U.S. will be created if a proposal to require the mortgage industry to make updated foreclosure reports is enacted.

The proposal to track foreclosed homes reliably is included in the House bankruptcy bill which is set to be discussed in the Senate.

A recent report from the Congressional Oversight Panel, headed by Elizabeth Warren, pointed out the lack of reliable data on foreclosures, such as number of foreclosure properties, causes of foreclosures and the results of foreclosure mitigation programs. The report highlights the failure of housing and federal banking agencies to collect and analyze foreclosure data despite the fact that the country is now 2 years into the housing crisis.

Representative Brad Miller, who introduced the foreclosure data gathering provision together with fellow Democratic Representative Elijah Cummings, said he has been campaigning for the tracking of foreclosure properties for over a year. But the mortgage industry has been blocking his efforts to call for accurate reports on foreclosure properties.

Miller also said he is starting to doubt the foreclosure numbers released by the Mortgage Bankers Association and other trade groups because they do not want government help in data gathering.

Another economist concerned about the state of foreclosure data gathering is Dean Baker, who is working with the Center for Economic and Policy Research. He said the banks prefer the status quo — lack of reliable data on foreclosure properties — because they do not like to show how troubled they really are.

Miller reiterated that reliable data on foreclosure properties and loan modifications are needed so Congress would know the number of foreclosure properties, the number of modifications, details on the modifications and the re-default rates.

Representative Cummings wonders why many homeowners whose loans have been modified are re-defaulting. According to one report, roughly half of those modified loans had their amounts increased instead of having them reduced.

The media has been relying on foreclosure tracking firm RealtyTrac, which releases its report on foreclosure properties monthly. Analysts point out that RealtyTrac monitors foreclosure filings based on court records and excludes other important information on the loans. They also said that RealtyTrac’s tracking method overstates figures on foreclosure properties because it counts foreclosure filings when there can be more than one filing on a certain property.

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• New York’s Foreclosure Data Inaccurate?
• Housing Data: Possibly Distorted by Foreclosures
• North Carolina Real Estate Market is Better than the Worst in Nation
• Foreclosures to Continue By Next Year