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1 in 5 Mortgages Are Underwater

Old 03-04-2009, 10:51 AM
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Default 1 in 5 Mortgages Are Underwater

In Nevada, more than half of all mortgage borrowers are upside down!


In a new report released Mar. 4, more than 8.3 million U.S. mortgages, or 20% of all mortgaged properties, were saddled with negative equity at the end of 2008, according to LoanPerformance, a company that tracks mortgage data. That's up two percentage points, from 7.6 million borrowers, from the end of September 2008. California led the nation with a monthly average of 43,000 new negative-equity borrowers over the three-month period, followed by Texas (16,000), Nevada (15,000), Florida (14,000), and Virginia (14,000). ...

The most severe "underwater mortgages"—mortgage loans that are 125% or higher than the value of the property—are in five states: California (723,000), Florida (432,000), Nevada (170,000), Michigan (128,000), and Arizona (122,000). Underwater homes are of serious concern because for some homeowners there is little incentive not to walk away and allow the home to fall into foreclosure. Foreclosed homes drag down the prices of neighboring properties, possibly dragging more homes underwater.



http://www.businessweek.com/bwdaily/...033_306801.htm
Old 03-04-2009, 11:45 AM
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Scary business.

I have almost 50% equity in my residence. I should've bought a 4,000 sf house that I could not afford with 100% financing, now the gov't would bail me out.

Scary stuff going on these days.

GE stock was below 6 earlier today.
Old 03-04-2009, 11:55 AM
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Dont worry, BHO is going to fix it.
Old 03-04-2009, 12:30 PM
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That number is probably correct if the total mortgage balance includes HELOC loans.....which means many of these idiots borrowed against the value of their houses to buy sh!t like TV's, clothing, cars and expensive vacations.
Old 03-04-2009, 12:57 PM
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If you read the article in the link it describes the filtering used; current mortgages on homes costing more than $100K, but less than $1.25-million ...
Old 03-04-2009, 04:21 PM
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Underwater homes are of serious concern because for some homeowners there is little incentive not to walk away and allow the home to fall into foreclosure.

I would think having no credit for 7-12 years would be incentive, but then I always figured paying my bills was mandatory instead of optional. How did we get to a point that people will just walk away if their dream house doesn't appreciate 10% a year! I think it's a "serious concern" because democrats can claim a problem far worse than it really is. The home I bought last July probably isn't worth the mortgage, either, but that's sure as hell no reason for taxpayers to be responsible!
Old 03-04-2009, 04:40 PM
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I wish now I would have borrowed 125% of my house's value as a second mortgage, wnet and paid cash for another house, and defaulted on the first one.

Let BHO sort it all out.
Old 03-04-2009, 05:07 PM
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This may be a stupid question but.......for the responsible borrower/home owner that is not upside down in a mortage, and that does not plan on selling anytime in the near future, why does it matter if values are dropping? Isn't it safe to assume that they will rebound eventually?

I read some of the news on Obama's re-fi plan and all I have to say is that I am not suprised. The man with the bottomless pocket book.
Old 03-04-2009, 05:32 PM
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Originally Posted by Tireless View Post
.....which means many of these idiots borrowed against the value of their houses to buy sh!t like TV's, clothing, cars and expensive vacations.






And as suggested right here on THT, boats!


Last edited by ABoater; 03-04-2009 at 05:34 PM.
Old 03-04-2009, 05:35 PM
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I know exactly ZERO people with upside down mortgages, and exactly ZERO people that are facing forclosure.

I don't think the IQ here is any higher (probably lower) than other places, but there must be some seriously bad places out there to make up for the lack of bad mortgages here.
Old 03-04-2009, 05:37 PM
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I don't see what relevance this is. Your home is not an investment. If you bought it to live in, who gives a shit what it's worth today? It's just like a stock, the daily value doesn't mean a damn thing if you're not selling.

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