Just Released: New Report On Negative U.S. Home Equity
Over 13 million homeowners still owe their banks more than their homes are worth. But if you also count folks with less than 20% equity (about the amount needed to pay selling costs such as Realtor commissions and to walk away with enough for a down payment on a new home)that number jumps to over 22 million! (in some of the harder hit areas, over 70% of homeowners with a mortgage fall into this bucket).
The ripple effects are impacting all of us…
- These folks can’t afford to list their homes for sale, fueling low home inventory levels across the country
- Knowing they’re underwater keeps these folks from spending, holding economic and job growth back for everyone
- Negative equity is a leading cause of mortgage default, accounting for over 6 million loans in default today – research shows the longer you remain under water the higher the likelihood is that you will give up and default
- Particularly for older Americans who relied on home equity for retirement and folks with kids who were counting on it to find college, the ripple effects may last further into the future than any of us planned.
If you or someone you know is struggling with being underwater, there are things you can do. For starters check out this video.
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