We are living in and experiencing times unlike any before. With all the changes in the financial market and with companies like Merrill Lynch gone, the media continues to capitalize on and propagate fear.

Every day the public hears more irrelevant/erroneous statistics about foreclosures and the media is enjoying the sensational results of comparing these figures to those during the 1930’s depression.

I’d like to set the record straight for those not interested in the hype.

A Few Facts

There are no statistics about the percentage of homes that were foreclosed during the great depression. The government does not track foreclosures or REO properties. The census refers foreclosure inquiries to the Mortgage Bankers Association, which only reports foreclosures back to 1990.

So why are these so-called “experts” parading all over the media proclaiming numbers and making comparisons? Sensationalism sells. It’s that simple.

Local Trends: Slower, Not Stagnant

When we talk about foreclosures we need to look at the figures region by region. Yes, some parts of the country have been hit pretty hard, especially California, Florida and Nevada. The Capital Region isn’t in Florida or Nevada. No, we are in Upstate NY, in the area we like to call Tech Valley.

Lets face it, our market has slowed down a bit — but prices remain steady and the number of foreclosures is not as big as people imagine.

One For You, Two For Me

We need to be careful how much “to heart” we take reports (from the media) saying the number of “people behind on mortgage payments” has increased.

I would assert that many people experiencing difficulty making their mortgage may well have both a first and a second mortgage. If someone can’t afford their first mortgage, they most certainly will not be paying that second mortgage (or home equity loan) either.

My conclusion is that some of the foreclosure reports have been artificially inflated by counting the two mortgages on a single property as two separate defaults, rather than a single property with two loans. This, in essence, would double the reported “foreclosure” rates on these properties, skewing the statistics and offering the media more fear-fodder.