More than 8.3 million U.S. mortgages, or 20 percent of all properties with a mortgage, were in a negative equity position at the end of 2008, according to newly released data from Sacramento, Calif.-based First American CoreLogic. That is a significant increase from 7.6 million, or 18 percent, of all mortgages in negative equity at the end of September.
Negative equity, often referred to as "underwater" or "upside down," means a borrower owes more on their mortgage than the home is worth. The collapse of the U.S. real estate market has eroded the value of many properties, placing many homeowners in the underwater position.
The situation could be getting worse. The First American CoreLogic data also shows than another 2.2 million mortgages are approaching negative equity and are within 5 percent of that equity position.
The Milwaukee area is faring better than the U.S. as a whole. In the Milwaukee area, 31,629, or 13.1 percent, of all properties with a mortgage are in negative equity. Another 11,917 mortgages, or 4.9 percent, are nearing negative equity, which means a total of 18.0 percent of the area’s mortgages are at or nearing negative equity.
In Wisconsin, 16.2 percent of mortgages are in negative equity.
Some states are in far worse shape than Wisconsin. In Nevada, 55.1 percent of the mortgages are in negative equity, with a total of 335,340. In Michigan 40 percent, or 459,385, of the mortgages are in negative equity. In Arizona, 31.8 percent, or 407,604, of the mortgages are in negative equity. In Florida, 30.3 percent, or 1.28 million, of mortgages are in negative equity. In California, 29.5 percent, or 1.9 million, of mortgages are in negative equity. California has the most underwater mortgages in the nation.