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Curtis@NapaValleyAddress.com 

Nearly one out of five homeowners underwater


Close to 18% of U.S. homeowners who are current on their mortgage payments are classified as underwater, setting the stage for additional defaults if home prices fall deeper, Lender Processing Services (LPS) said in its July Mortgage Monitor Report.

The mortgage technology firm said mortgage delinquencies are down 30% from the peak established in January 2010.  LPS said there is a direct link between negative equity and new problem home loans, and risks remain if home prices decline.

"As negative equity increases, we see corresponding increases in the number of new problem loans," LPS said Monday. "In Nevada and Florida, two of the states with the highest percentage of underwater borrowers, more than 3% of borrowers who were up to date on their payments are 60 or more days delinquent six months later. This suggests that further home price declines – should they occur – could jeopardize recent improvements."

The report does show improvements in loan delinquencies with the U.S. loan delinquency rate falling to 7.03% in July, a 1.6% drop from June.  The foreclosure pre-sale inventory rate also edged down 0.2% month-over-month,hitting 4.08% in July.

States with the most non-current loans include Florida, Mississippi, Nevada, New Jersey and Illinois. Meanwhile, those with the lowest percent of non-current loans include Montana, Alaska, Wyoming, North Dakota and South Dakota.

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11 Comments on Think we are out of the real estate mess, think again; 1 in 5 still underwater

SEP
24
226,484 Points 4 Featured Posts Outside Blog Called Shot Master

Hi Curtis - still a long way to go but the recovering home prices are quickly putting a dent in these numbers. Regards Dave
7:51am • #1
355,612 Points 3 Featured Posts Outside Blog Called Shot Master

Dave

I agree but I hear banks are again acting weird in their short sales, playing hardball. The agent in my office who has done the most SS of anyone, I would guess between 300-500, said she has lost more deals recently due to this than she has in the last year. We will just have to wait to see the end of this mess. My guess by the end of next year.

Thank goodness for the short supply everywhere for as you so aptly stated, it has helped and kept pricing on an upward pace. cheers cvc
7:57am • #2
586,663 Points 46 Featured Posts Outside Blog Called Shot Master

Curtis,  This is unsettling for sure.  There is still plenty of recovery yet to be seen in the housing market.  Another infulx of underwater real estate is never a good thing.  We are making progress, one home and one family at a time. 
8:21am • #3
355,612 Points 3 Featured Posts Outside Blog Called Shot Master

John

We are and after we all get through this, we should host a few, cheers cvc
8:37am • #4
1,519,636 Points 112 Featured Posts Localism Sponsor Outside Blog Called Shot Master

I hear the stats and just like everyone else, I look at MY situation.  I am upside down with loan to value.  Can afford the payments, which is great.   However, would love a bit of wiggle room with a home equity line.  I have four windows that are custom size that need replacing and don't have the money to do it.  Windows have been covered up for going on two years.  
8:59am • #5
355,612 Points 3 Featured Posts Outside Blog Called Shot Master

Chris Ann

I just got a letter from my lender about a none qualifying refi via the recent loan settlement and because I had put my property into a trust, I couldn't qualify. They sure don't want to help. Fortunately I bought my house in 1986 and only took a little money out and have quite a bit of equity. I empathize with your situation. cheers cvc
9:17am • #6
403,321 Points 8 Featured Posts Outside Blog Called Shot Master

Curtis - I'm going to look at this with my glass of wine half-full.  At lease the number of home owners under water isn't 2 out of 5, or 3 out of 5.  
2:05pm • #7
851,028 Points 72 Featured Posts Outside Blog Attended Rain Camp Called Shot Master

Curtis, We are nowhere near out of the real estate mess.  And more and more homeowners who can “afford” their mortgage payments with interest rates twice what rates are today are wanting OUT.  They can’t refinance and get no help with a modification because it is “affordable.”  I wonder what Obama will come up with next.
7:36pm • #8
SEP
25
355,612 Points 3 Featured Posts Outside Blog Called Shot Master

Laura, Kathleen

Granted it is not as bad as it was and getting better. But I am still not convinced it is as good as having so tight inventory would have normally meant in the past. cheers cvc
11:38am • #9
123,346 Points 2 Featured Posts Outside Blog

Curtis, that means that 1 in 5 homes sold will result in the other 4 out of 5 getting crushed on their appraisals.  
11:52am • #10
SEP
26
355,612 Points 3 Featured Posts Outside Blog Called Shot Master

Glenn

I would have thought so but lately appraisers around here have been looking past the low SS or REO sale. I think there are enough good comps finally out there. cheers cvc
12:06pm • #11


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Curtis Van Carter your Napa Valley Broker Extraordinaire in Yountville

Yountville, CA

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Coldwell Banker Brokers ofthe Valley, Yountville Napa Valley

Address: PO Box 2905, Yountville, CA, 94599

Office Phone: (707) 944-0421

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