A Speedy Decline For Underwater Mortgages

Posted by John Sabia on Friday, August 7th, 2015 at 11:54am.

In 2010, the total of home-owners who were underwater (owed more on their loan than the home was worth) reached a peak of 15 million. In a position of negative equity, these homeowners have little or no options until housing prices rise and their property gains positive equity, also known as above water.

Recently, a study conducted by Black Knight Financial Services discovered that From January thru June of this year, there has been a 26 percent decline in the number of underwater homeowners. These findings underscore not only good news for these homeowners, but it also signals a large return in home values after dropping significantly succeeding the financial melt down.

In addition, this favorable news also means that almost one million homeowners can once again begin the process of building home equity or now have the option to list their home for sale without having to list it as a distressed property, such as a foreclosure or short sale.

With this years decline in underwater borrowers, there are still about 3 million homeowners across the country who remain underwater - an 80 percent drop from 2010.  This drop also outpaces last year's decline of underwater borrowers, which dropped 20 percent in 2014. More here..

photo of house under water

John Sabia

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