June 8, 2011 (Shirley Allen)
The number of underwater mortgages declined to 22.7 percent of all residential properties at the end of the first quarter of 2011, but if you had a home equity loan you were twice as likely to have negative equity according to the latest data released by CoreLogic.
Eighteen percent of borrowers who did not have a home equity loan were under water at the end of the first quarter, however, 38 percent of borrowers with home equity loans were in a negative equity position and over 40 percent of borrowers who had negative equity, had home equity loans.
And the difference in the amount of negative equity between underwater borrowers with home equity loans and those who didn’t was substantial.
Borrowers who had negative equity in their properties, but didn’t have a home equity loan, were underwater by an average of $52,500. Borrowers who had negative equity and had taken a home equity loan against their property were underwater by an average of $83,000.
The total number of residential properties with negative equity at the end of the first quarter of 2011 was 10.9 million, which was down from 11.1 in the fourth quarter of 2010.
The amount of borrowers who had less than five percent equity in their homes, referred to as near-negative equity, was 2.4 million.
The number of negative equity and near-negative equity mortgages accounted for 27.7 percent of all residential properties in the first quarter, which was down from 27.9 percent at the end of the fourth quarter.
Nevada was the state with the highest negative equity percentage with 63 percent of all mortgaged properties underwater, followed by Arizona (50%), Florida (46%), Michigan (36%) and California (31%).
Las Vegas was the largest metropolitan area with the highest negative equity percentage with a 66 percent share, followed by Stockton (56%), Phoenix (55%), Modesto (55%) and Reno (54%).
Tags: CoreLogic, underwater mortgages, residential properties, home equity loan, negative equity, borrowers, mortgage loans
Source:
CoreLogic
