First American CoreLogic sent me a release on Wednesday that 20 percent of all mortgages in the Wichita area are underwater. Whoa. That’s huge. That’s a disaster. That means that 1 of every 5 homes with a mortgage is no longer worth the value of the mortgage and are ripe for foreclosure.
But that doesn’t make sense. We’ve been told by every local and national group for months that our housing market is slowing down, and prices may even be starting to dip, but there has never been any indication that we’re doing the Las Vegas plunge.
So I checked with some locals in the mortgage business and they said that seems out of whack. I called First American for a clarification. Their economists were too busy to talk, but their PR person said it’s possible because of second mortgages and possibly a small sample.
We’ll see.
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A postscript: I ran my traps as well on this shocking report, and I can find no analyst or industry rep in Wichita who believes those numbers to be legitimate.
The reason: Underwater mortgages are largely a function of people buying and financing overvalued homes who’ve since plummeted.
We’re told that condition is rare in the Wichita area.
Dan,
So, a company pitching themselves as experts in mortgage data can’t get the numbers right? Come on, Ogilvy PR! You should have a better response to a reporter than that! Not good.