Share of US mortgages underwater up in Q4-CoreLogic
March 1 |
March 1 (Reuters) - The share of underwater U.S. homeowners rose in the fourth quarter of 2011 to its highest level since 2009, data analysis firm CoreLogic said on Thursday.
The report showed 11.1 million homes were in negative equity, where the homeowner owes more than the home is worth. That accounts for 22.8 percent of mortgages, up from 10.7 million, or 22.1 percent in the third quarter of last year.
It was the highest level since the third quarter of 2009, when CoreLogic started tracking the data.
An additional 2.5 million borrowers had less than five percent equity, considered to be "near-negative equity". Together, negative equity and near-negative equity homes accounted for 27.8 percent of mortgages.
"The high level of negative equity and the inability to pay is the 'double trigger' of default, and the reason we have such a significant foreclosure pipeline," Mark Fleming, chief economist at CoreLogic, said in a statement.
"While the economic recovery will reduce the propensity of the inability-to-pay trigger, negative equity will take an extended period of time to improve, and if there is a hiccup in the economic recovery, it could mean a rise in foreclosures."
Nationally, total mortgage debt outstanding on properties in negative equity increased to $2.8 trillion from $2.7 trillion in the previous quarter.
Nevada had the highest percentage of underwater homeowners at 61 percent. The top five was rounded out by Arizona, Florida, Michigan and Georgia.
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