Clark Hoyt, ombudsman of the NY Times, goes into the tank for Edmund Andrews, author of "Busted", who was busted by Megan McArdle.
To recap - Edmund Andrews, Times financial reporter, is promoting a new book claiming to detail his personal journey through the dark underside of easy mortgages and financial distress.
The NY Times gave him space in the NY Times magazine to talk up his story and his book. But missing from the story is any mention of the fact that his wife has filed for personal bankruptcy not once, but twice. For a story about personal finances, that is a staggering omission, leading to some absurd phoniness in the Andrews tale.
However, Clark Hoyt addresses it this way:
Andrews is an excellent reporter who explains complex issues clearly. There are plenty of them to cover without assigning him to those that could directly affect whether he keeps his own house. He is too close to that story.
Let me join the bashing with a frontal assault - there is no way the Andrews story can be read as an accurate, honest depiction of his experience. This, for example, is from the NY Times magazine (my emphasis):
The only problem was money. Having separated from my wife of 21 years, who had physical custody of our sons, I was handing over $4,000 a month in alimony and child-support payments. That left me with take-home pay of $2,777, barely enough to make ends meet in a one-bedroom rental apartment. Patty [Andrews' new wife] had yet to even look for a job. At any other time in history, the idea of someone like me borrowing more than $400,000 would have seemed insane.
But this was unlike any other time in history. My real estate agent gave me the number of Bob Andrews, a loan officer at American Home Mortgage Corporation. Bob wasn’t related to me, and I had never heard of his company. “Bob can be very helpful,” my agent explained. “He specializes in unusual situations.”
Bob returned my call right away. “How big a mortgage do you think you’ll need?” he asked.
“My situation is a little complicated,” I warned. I told him about my child support and alimony payments and said I was banking on Patty to earn enough money to keep us afloat. Bob cut me off. “I specialize in challenges,” he said confidently.
Bob called back the next morning. “Your credit scores are almost perfect,” he said happily. “Based on your income, you can qualify for a mortgage of about $500,000.”
What about my alimony and child-support obligations? No need to mention them. What would happen when they saw the automatic withholdings in my paycheck? No need to show them. If I wanted to buy a house, Bob figured, it was my job to decide whether I could afford it. His job was to make it happen.
“I am here to enable dreams,” he explained to me long afterward. Bob’s view was that if I’d been unemployed for seven years and didn’t have a dime to my name but I wanted a house, he wouldn’t question my prudence. “Who am I to tell you that you shouldn’t do what you want to do? I am here to sell money and to help you do what you want to do. At the end of the day, it’s your signature on the mortgage — not mine.”
So, Andrews told the mortgage broker that his wife's income would be important, but for some reason she was not included on the mortgage application, which (as best I can infer) was only in Andrew's name. Why was she not part of the mortgage application? Well, she had future prospects but no current income, so that would be a possible reason to omit her. But surely there is a possibility that her previous bankruptcy would have been a huge disqualifying red flag.
Whether the mortgage broker knew of her previous bankruptcy is left as a mystery - it's hard to believe her credit score was perfect, so I infer that when Andrews claims to have been told that "Your credit scores are almost perfect" it means that he had more than one nearly perfect score. Is that written to be intentionally deceptive? Did the Times editors deliberately let that pass, or were they also in the dark as to the real story? Who knows? It's certainly not clear from the Hoyt defense or Andrews' response to McArdle that the Times editors were apprised of the situation.
So, is this a story of greedy mortgage brokers or nearly fraudulent mortgage applications? I am pretty sure the latter tale would not be publishable, which would hardly suit Mr. Andrews current financial plan, which is to hit it rich with a best-seller, however phony.
Is this Mr. Hoyt's idea of full and fair reporting? Knowing about the wife's prior bankruptcy makes reading this article even more challenging than doing a crossword puzzle, as the reader tries to figure out what Andrews is dancing around and what really went on.
I am sympathetic to the notion that in the current environment the NY Times wants to help out any of their reporters trying to make a buck on the side. But I wonder at how much of their reputation and credibility they are prepared to invest in his venture.