Nearly 10 percent of Durham mortages 'underwater'

March 5, 2009 3:07:06 PM PST
Results from a study released by First American CoreLogic show almost 10 percent of Durham mortgages are in negative equity.The report, which was released March 4, reflects data as of December 31, 2008.

Durham has 5,512 or 9.9 percent of total mortgages in negative equity.

An additional 3,202 mortgages, or 6.1 percent, are in near negative equity, resulting in a total of 16 percent of all outstanding mortgages in negative equity and near negative equity for Durham, according to the study's findings.

In comparison, more than 8.3 million U.S. mortgages or 20 percent of all mortgaged properties were in negative equity as of December 31.

Nationally about 700,000 additional borrowers slid into negative equity in the last quarter of 2008.

In addition to those borrowers, the study found 2.2 million mortgages nationwide are approaching negative equity.

According to First American CoreLogic, negative equity is also referred to as "underwater" or "upside down," meaning a borrower owes more on their mortgage than the home is worth.

First American CoreLogic says the future of negative equity depends on the distribution of equity and home price declines. Markets that have not already experienced large increases in negative equity will probably see an increases in the future.

"The accelerating share of negative equity, combined with deteriorating economic conditions, means that mortgage risk will continue to increase until home prices and the economy begin to stabilize," said Mark Fleming, chief economist for First American CoreLogic. "Going forward, the worrisome issue is not just the severity of negative equity in the 'sand' states, but the geographic broadening of negative equity that is expected to occur throughout the year."

First American CoreLogic is a member of The First American Corporation family of companies. It's the largest provider of real estate, property and ownership data and advanced analytics for information on foreclosures, delinquencies, median home prices, home price indices, home valuations, sales activity and mortgage loan originations.

For a look at the entire study, click here.


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