This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Rising Home Prices Pull 850,000 Borrowers Out of Deep Waters

Underwater borrowers often cannot sell their homes as they will not recover enough to repay their loans. This also holds true for "under-equitied" borrowers -- those with less than 20% equity in their home. These borrowers might find it harder to secure a mortgage for their next home without coming up with a 20% downpayment.

A recent study by Zillow estimated that 44% of homeowners with a mortgage can't sell their homes.

CoreLogic' estimates 11.2 million borrowers or 23% of all residential properties with a mortgage are under-equitied. Further, about 2.1 million of these borrowers have less than 5% equity, referred to as "near negative equity."These borrowers are at risk of plunging back underwater if home prices slide.

So home prices need to continue to rise in order to ensure these borrowers are firmly in the black.

-- Written by Shanthi Bharatwaj in New York.

>Contact by Email.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.
2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
AAPL $127.60 2.28%
FB $83.09 2.87%
GOOG $535.38 2.16%
TSLA $205.27 -0.74%
YHOO $44.66 0.46%

Markets

DOW 18,034.93 +208.63 1.17%
S&P 500 2,100.40 +19.22 0.92%
NASDAQ 4,994.6020 +62.7870 1.27%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs