Throughout Foreclosure Research’s endeavor to find the truth behind foreclosure data, many different avenues have been explored to help demystify foreclosure statistics. Some of the more obvious causes of these untruths so to speak, came from the inaccuracies of several foreclosure listing providers, and from faulty reporting in the media.

However, the underlying truth behind the economy, foreclosures, and the housing market downturn are unarguably complex. Yet many factors are identifiable and some more pertinent than others.

One interesting perspective that has yet to be noted comes from Jay Brinkmann, a chief economist for the Mortgage Banker’s Association. In an article titled, “Looking at another side to a foreclosure report,” published on March 28, 2009 in the Houston Chronicle, Brinkmann had a separate take on the latest foreclosure figures. The figure in question was from an article on the Reuters wire titled, “One in 8 U.S. homeowners late paying or in foreclosure.”

The Chronicle article tries to explain the difference between a mortgage foreclosure and actual homeowners that are losing their homes. Here is an expert of Brinkmann’s observation:

“The ‘One in eight homeowners either in foreclosure or behind in their payments’ is wrong. For starters, it’s one in eight mortgages — not homeowners — and this distinction is very, very important. When you look at the number of mortgages out there, it includes lots of investment/rental properties.”

Brinkmann continues to explain that while there are “x” amount of mortgage foreclosures, doesn’t necessarily correlate to families being kicked out of their homes. He used an example of a New Jersey grad student who bought 3 condominiums in Florida, with over-leveraged mortgages. Or an attorney in Phoenix who purchased 30 homes, both investors stating the homes were each “owner occupied.”

These pseudo-investors gambled with the market and lost. They now comprise a large percentage of “homeowners” walking away from their mortgages and ultimately contributing to the grim statistics in the media. They are not to be confused with those who have in deed suffered economic hardship, but are rather failed speculators.

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