If We’re Paying for the Mortgages, Shouldn’t the Data be FOIA-able?

Just a thought in light of Calculated Risk’s posing a similar question:

If most of the mortgages being written now are implicitly guaranteed by our fiscally-absurd government (no longer available), shouldn’t the citizens have access to that data?

*

From the above-sourced article (archived: 2011): (bolding mine)

Members of Congress, state banking regulators and academics say they have been regularly stymied in attempts to access the data. In many cases they cannot afford it. Sometimes regulators who have the data cannot share it because of proprietary arrangements with data providers.

But thanks to a little-discussed provision of the Dodd-Frank Act, legislators, regulators and even nonprofit housing activists may eventually get a more comprehensive picture of the mortgage servicing industry.

Section 1447 of the law calls for the Department of Housing and Urban Development to establish and maintain a comprehensive national database on foreclosures and defaults on mortgages and to make the information publicly available. The data is supposed to drill down to the census tract level and include the number and percentage of loans that are delinquent by more than 30 days; those that are in the foreclosure process; and those that are underwater.

Rather, read the actual bill (you and I both know that we’d be among the first): (bolding mine)

SEC. 1447. DEFAULT AND FORECLOSURE DATABASE.

(a) Establishment- The Secretary of Housing and Urban Development and the Director of the Bureau, in consultation with the Federal agencies responsible for regulation of banking and financial institutions involved in residential mortgage lending and servicing, shall establish and maintain a database of information on foreclosures and defaults on mortgage loans for one- to four-unit residential properties and shall make such information publicly available, subject to subsection (e).

(b) Census Tract Data- Information in the database may be collected, aggregated, and made available on a census tract basis.

(c) Requirements- Information collected and made available through the database shall include–

(1) the number and percentage of such mortgage loans that are delinquent by more than 30 days;

(2) the number and percentage of such mortgage loans that are delinquent by more than 90 days;

(3) the number and percentage of such properties that are real estate-owned;

(4) number and percentage of such mortgage loans that are in the foreclosure process;

(5) the number and percentage of such mortgage loans that have an outstanding principal obligation amount that is greater than the value of the property for which the loan was made; and

(6) such other information as the Secretary of Housing and Urban Development and the Director of the Bureau consider appropriate.

…

e) Privacy and Confidentiality- In establishing and maintaining the database described in subsection (a), the Secretary of Housing and Urban Development and the Director of the Bureau shall–

(1) be subject to the standards applicable to Federal agencies for the protection of the confidentiality of personally identifiable information and for data security and integrity;

From a 2010 article at the Motley Fool: (bolding mine)

And that’s just the market share of outstanding mortgages. The market share of current mortgage issuance is even more lopsided. Fannie and Freddie combined currently make up about 70% of new mortgage issuance, with the FHA taking up close to 20%, for a total of around 90% reliance on these three government-backed vehicles.

Even with the above aggregate data, it I don’t see how useful it’s going to be to local markets. For example: “47% of the mortgages in the Charlottesville MSA are more than 30 days delinquent (if it’s that high, I’ll eat one of my flip flops; I’d wager that number is less than 7%).

What the market needs is the answer to this question – which houses’ mortgages are delinquent? Where are the foreclosures – to the street level? The Charlottesville real estate market (and I suspect others) differs neighborhood by neighborhood, street by street, and most assuredly county by county. Without this level of information, we will be left better macro data; but real estate is local. I’m not saying that the data should be this granular as the privacy concerns are absolutely real, but the privacy concerns and the goal of the bill are in conflict.

All told, conceptually this sounds great. In practice and reality, I’ll bet $5 that it’ll cost bunches of money that will never see any useful application.

* Photo courtesy of

Related:

Reason has a related take.