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How many US homeowners are underwater (have negative equity in their house)?

Question:

How many US homeowners are underwater (have negative equity in their house)?

Mortgage:

The book value of a mortgage is the present value of the future mortgage payments, discounted at the interest rate on the loan. If a house's market value is below the book value of the mortgage, the homeowners are said to be underwater.

Answer and Explanation:

According to Bloomberg's estimates, there are currently 4.5 million U.S. homeowners whose house is worth less than the value of their mortgages, i.e., underwater, in 2017. This represents roughly 9% of the all homeowners in the United States.


Learn more about this topic:

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Buying a House: Mortgage Types & Loan Length

from Finance 102: Personal Finance

Chapter 7 / Lesson 4
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