Approximately 25% of all home owners with mortgages are now underwater, meaning they owe more on the home than the home is worth. For example, paying a $250K mortgage on a home that is now worth $190K.
The kicker is that as home values sink even more, the number goes from 25% to 40% of home mortgages going underwater.
Talk about foreclosures, this would mean the potential for foreclosures is increasing.
McClatchy: Housing is bad enough, but wait — it'll get worse
That means about 25 percent of all U.S. mortgages are exceeding the value of the homes the mortgages are financing.
Nevada led all states with 48 percent of homes with negative equity. Florida and Arizona each had 29 percent of homes with underwater mortgages, while 27 percent of mortgages in California were upside-down, the group said.
If home prices fall another 10 to 15 percent, as measured by the Case/Shiller Home Price Index, then four out of every 10 mortgages in the U.S. could be underwater, Feldstein said.
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