Now when I read the story, I too had my doubts, for this reason: if the reports CoreLogic used included HELOCS — home equity lines of credit — why would 30% of Dallas mortgages be underwater? In Texas we are limited to 80% loan to value home equity ratios. That would mean that if someone maxed out their HELOC in Texas, they’d have to have lost 20% of the value of their BRAND NEW 100% FINANCED home and then some to be underwater. Or maybe they’d be flat. Whatever, I thought, as I usually do, who am I to question the brainpower and computers of these geniuses in California? God, we are all so bad!

Well, Gwen questioned them. She did what I should have done and picked up the phone and said, you know, this just doesn’t look right. Artkansas never had a housing bubble. Neither did Texas. She did some research on CoreLogic’s methodology and found out — hold the presses!!! — the company’s numbers may be biased on the HIGH SIDE . In other words, giving us facts that are worse than they really are.

Most of the mortgages used in the study are less than six years old — really? Did the whole world re-finance in the last six years? When she called CoreLogic, Gwen got them to admit actually 85% are less than six years old.

The study assumes that the borrower owes the balance of the mortgage when they took out the loan — in other words, it does not take into account monthly mortgage payments made against that balance. Why? Because of the way CoreLogic gets it’s information — it aggregates information from lenders, matching total mortgaged amounts in geographic chunks, like how much was loaned in a specific area or zip code. Then the computers whiz out numbers against property values. (Obviously I over-simplify.) They get this proprietary info from the lenders and use original loan amounts from public data records. But they base it on the original loan amount — they never get to come into our file cabinets and see how much money we’ve actually paid down on that mortgage or home equity LOC.

See where I’m going with this?

Gwen also found out the study includes the HELOCs but again, uses only the maximum credit figures since that is all the information that is available. So it looks like every one’s HELOC is at the max. Don’t know about you, but I have to pay down on mine every month and in fact, ours is almost paid off.

So if you are using figures that assume homeowners still owe every penny in debt they ever took out on a loan, figures that give no credit to what homeowners have in fact paid, then Gwen asks, maybe that study could over-estimate the number of folks whose mortgages are underwater.

“It’s biased to the high side,” says Gwen. “We need to be a little more skeptical of these studies.”

No kidding.

(Note: Thanks to Gwen Moritz for not only questioning the CoreLogic report but notifying the Alliance of Area Business Publishers of her query via email, which Glenn Hunter, editor of award-winning DCEO, then forwarded to me.)

$2,450,000.

Agent: Ralph Randall, Dave Perry-Miller & Associates, an Ebby Halliday Company: 972.733.9613

KRLD radio personality Ernie Brown recently moved from the West Village to a new “stately Brown manor”  WAY up in Frisco — Shoal Creek Villas — so close to 121 you can see the highway from his second floor. But for Brown, it’s well worth the drive.

“It’s the quietest house I’ve ever lived in,” he says, “it took me two weeks to know that no noise is normal.” The house was so quiet it was keeping him up at night, in fact. You would think he wanted to be closer in to his job, like he was when he lived five minutes from the KRLD studios at Mockingbird and Central.  In fact, that was TOO close to work for him — Brown says he’d often go to a sandwich shop just to mentally prepare himself for work. Or wake up.

So here’s the bachelor pad, a two story, 2800 square foot home he picked up in the mid $300′s. Smart buy: Brown’s surrounded by homes that are more expensive, including the one next door listed for $424,000. For a bachelor, the house was in great shape. His kitchen stove was so spotless I asked if anyone ever used it.

“I paid a cleaning woman to come by three weeks ago, and she cleaned so well I haven’t used the kitchen since, didn’t want to dirty it.” Typical guy!

Brown admits he has no decorating vision, so feel free to pitch in some ideas. I asked him if he was going to keep the existing wall color and he gave me a look I’ve seen hundreds of times: “why wouldn’t I?” He’s got a new king-sized bed (cost a fortune) in the huge master, a red dining room, a library with shelves for his many books, two bedrooms upstairs including the “nursery” — one room he will have to paint to cover up the baby room stencils, and a game room where his computer paraphernalia is all set up. (I was impressed that Brown relegated the computer stuff upstairs — my son would have had it in the middle of the great room.) But outside, it’s party central: outdoor kitchen, bar, grill, kegerator, and spa. Brown’s all set for some fun in the sun and when it gets too hot, he and his friends can do jack-knifes across the street at his community pool. $150 a month covers the pool, and all lawn maintenance in the front of his home. This is his third home, and the biggest change of all. But Brown got a great deal and a lot of bang for his buck up in Shoal Creek Villas.

No inflation is going on right now, the government is trying to stop de-flation. Almost all the experts agree that we may see eventual inflation because of the economic stimulus — that money pumping into our systems. We may have a window of about 12 to 16 months before interest rates will have to rise to control it.  The Fed can and will monitor inflation tightly 24/7 and may in fact want to see a bit of inflation, say 2 to 4%, anything but hyperflation or deflation.

The banks still aren’t lending, what will it take to move them? Maybe higher interest rates. Cox doesn’t think you can pass laws forcing banks to lend money.

“When the risks and rewards are in balance, they will lend,” he says.

Our day of reckoning for the stimulus package will be when we convince China and Japan that treasuries are worth buying.

Why are the banks doling out TARP funds to the “troubled” banks rather than the solid banks, so the solid banks could lend the funds?

Good question, said Cox.

Unemployment is starting to affect everyone, even in the higher net worth classes. Though Texas thankfully lags the nation in unemployment, layoffs may not be over yet. Two solid businesses now: healthcare and education.

And these men think Americans’ spending habits have changed dramatically, maybe forever for a generation. Just as they did after the Great Depression, people are tightening their belts. Whether they keep them tight and how many years they live lean depends on how affected they are by this economic downturn, how long it lasts. We may not see mega leverage for another twenty years.

Higher taxes may force people out of states like New York and California, and we could see another wave of  sunbirds heading here for our sensibly valued homes. Watch: commercial real estate failings. Be glad we live in a city that continues to attract business and generate jobs as well as technology (intelligent medical systems being developed at Texas Instruments) and varied corporate headquarters. Buffalo, New York was home to the largest number of wealthy individuals in the U.S…  once upon a time.

Another client paid a local “law firm” that advertises on a local Dallas radio station $3,000 to get his mortgage modified; the firms first piece of advice was to intentionally get behind on his mortgage. The mortgage company posted him for foreclosure, the modification people told him that they couldn’t help him. Now he now faces the prospect of losing his home if he does not pay three months of payments all at once, plus all of the bank’s legal fees related to the foreclosure, and he’s out the $3,000. What a scam.

Then there’s the “foreclosure rescue specialist” called North American Foreclosure, LLP.  Folks need to be careful, says Polk, a bankruptcy attorney and home foreclosure expert for 15 years.

“Sadly, a person will try whatever they have to in order to keep their home and a roof over their kid’s head.  And who can blame them?,” says Polk. “But a con artist can sense that kind of desperation.   The number of so-called “loan modification counselors” has quadrupled in the last 18 months as the hucksters have opened up shop.  These fly-by-night operators target desperate homeowners– the easiest mark, but also the least able to afford such a scam.”

Some of us used to look in the newspaper for financial information, like ads on mortgage rates. Well those days are gone because mortgage rates can now change up to five times a day.  As The Mortgage Reports tells us, you’d do better to follow rates through Twitter. Take-away: pre-qualify for your mortgage loan, and get the best possible rate by asking your lender to send you rate changes on Twitter.

I’m re-thinking my stance on hating homeowners associations.

I ask you: what price range home can you afford with $7500 a month?�