People love rooting for the underdog and it appears the media is no exception.
“Karen and David Shearon, working people who made less than $30,000 a year at the time, refused to be intimidated and fought foreclosure – claiming the mortgage broker promised them a fixed-rate, low-interest loan on their $335,000 house,” said ABC correspondent Jim Avila.
However, rather than exploring the possibility that the family may have bitten off more than it could chew,
“At closing, they were presented with a high-interest package and balloon payments they feared they could not pay, but signed they say, under pressure,”
According to the “home affordability calculator” on the National Association of Realtor’s Web site, if average variables are applied – a 5.6 percent interest rate (on the conservative end), 3-percent closing costs, a 5 percent down payment – the most the Shearons should have been able to afford was a home for just under $93,000.
And even though there is a notification process in New York City, where a homeowner is given warning before a process server arrives, ABC’s
“It was a workday afternoon on Staten Island, when suddenly, the quiet of this blue-collar enclave was shattered by the frightening sounds of the dreaded process server,”
Throughout the story,
The Shearons went to court and wound up being allowed to stay in their home, according to “World News,” so
“[T]hey did know enough to take the first step to saving their home from foreclosure. Get outside help. Don't negotiate with the bank alone,”
“[T]he little guys won,”
In March, “CBS Evening News” used an atypical example of a homeowner that agreed to a mortgage with an 11-percent interest rate for its report on mortgage-crisis hardship. The stories are part of a larger trend of journalists using extreme examples in coverage of economic news.
ABC has been erratic with its stories involving consumer debt. According to a Business & Media Institute study, "Debt: Who’$ Responsible?” ABC News was subpar when it came to the issue of personal responsibility. A segment from March 2006 downplayed the role of the consumer in taking on financial obligations.