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Do You owe More on Your Mortgage Than Your Home is Worth?

By Martin Harris in Mortgage and Lending
July 23rd, 2010

According to Zillow.com,an Internet provider of home valuations…

Almost one-third of U.S. homeowners who bought in the last five years now owe more on their mortgages than their properties are worth

Second-quarter home prices fell 9.9 percent from a year earlier, giving 29 percent of owners negative equity, said Zillow, the Seattle-based service that offers values for more than 80 million homes. For those who bought at the 2006 peak of the housing market, 45 percent are now underwater, Zillow said.

This can be a frightening predicament for first-time homeowners and people who have to relocate on a regular basis for their employment. If you’re forced to relocate every few years for work it could mean giving up a significant amount of equity on each move.

Those hardest hit by the declines in the market are homeowners in California. In four of the state’s metropolitan areas Stockton, Modesto, Merced and Vallejo-Fairfield, the number of homeowners whose mortgage debts exceeded the values of their properties topped 90 percent, Zillow said.

In five more California areas which include the Inland Empire, Bakersfield, Yuba City, El Centro and Madera, the percentages were more than 80 percent whose mortgage debts exceeded the values of their properties.

Do you owe more on your mortgage than your home is worth? If so, please feel free to comment on this article with the area you are located.


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