More than 15.2 million mortgages – 32.2% of all US mortgages – are underwater
According to a report by First American CoreLogic, almost a third of all US home mortgages are underwater. For those unfamiliar with the term, a mortgage is underwater when the mortgage amount owed on the home is worth more than the home itself.
Approximately 15.2 million homes are now in a negative equity position, which represents about 32.2% of all home loans. Negative equity is a strong cause of foreclosure according to Mark Fleming, chief economist at First American CoreLogic.
Which States are Underwater?
Over half of all underwater mortgages can be accounted for in just 3 states: Nevada, Arizona and Florida. The second worst offenders are California and Michigan.
Although the negative equity rate has dropped from 32.5% at the end of March, it is by no means an indication of a recovering housing market. More and more underwater mortgage help has been made available through several government programs lately, however, and hopefully the trend will continue.