New CoreLogic® Data Reveals Q2 Negative Equity Declines in Hardest Hit Markets and 8 Million Negative Equity Borrowers Have Above Market Rates
[ Back ]   [ More News ]   [ Home ]
New CoreLogic® Data Reveals Q2 Negative Equity Declines in Hardest Hit Markets and 8 Million Negative Equity Borrowers Have Above Market Rates

--75 Percent of Negative Equity Properties Have Above-Market Interest Rates--

SANTA ANA, Calif., Sept. 13, 2011 — (PRNewswire) — CoreLogic (NYSE: CLGX), a leading provider of information, analytics and business services, today released Q2 negative equity data showing that 10.9 million, or 22.5 percent, of all residential properties with a mortgage were in negative equity at the end of the second quarter of 2011, down very slightly from 22.7 percent in the first quarter. An additional 2.4 million borrowers had less than five percent equity, referred to as near-negative equity, in the second quarter. Together, negative equity and near-negative equity mortgages accounted for 27.5 percent of all residential properties with a mortgage nationwide. The new report also shows that nearly three-quarters of homeowners in negative equity situations are also paying higher, above-market interest on their mortgages.

(Logo: http://photos.prnewswire.com/prnh/20100609/CLLOGO)

Negative equity, often referred to as "underwater" or "upside down," means that borrowers owe more on their mortgages than their homes are worth. Negative equity can occur because of a decline in value, an increase in mortgage debt or a combination of both.

Data Highlights


"High negative equity is holding back refinancing and sales activity and is a major impediment to the housing market recovery. The hardest hit markets have improved over the last year, primarily as a result of foreclosures. But nationally, the level of mortgage debt remains high relative to home prices," said Mark Fleming, chief economist with CoreLogic.

The full Q2 2011 negative equity report, with charts and state-level data, is available at http://www.corelogic.com/about-us/news/asset_upload_file75_12141.pdf

Methodology:

CoreLogic data includes 48 million properties with a mortgage, which accounts for over 85 percent of all mortgages in the U.S.** CoreLogic uses its public record data as the source of the mortgage debt outstanding (MDO) and it includes first mortgage liens and junior mortgage liens and is adjusted for amortization and home equity utilization in order to capture the true level of mortgage debt outstanding for each property. The current value was estimated by using the CoreLogic Automated Valuation Models (AVM) for residential properties.  The data was filtered to include only properties valued between $30,000 and $30 million because AVM accuracy tends to quickly worsen outside of this value range.

The amount of equity for each property was determined by subtracting the property's estimated current value from the mortgage debt outstanding. If the mortgage debt was greater than the estimated value, then the property is in a negative equity position. The data was created at the property level and aggregated to higher levels of geography.

** Only data for mortgaged residential properties that have an AVM value is presented. There are several states where the public record, AVM or mortgage coverage is thin. Although coverage is thin, these states account for fewer than 5 percent of the total population of the U.S.

Source:  CoreLogic.

The data provided is for use only by the primary recipient or the primary recipient's publication or broadcast. This data may not be re-sold, republished or licensed to any other source, including publications and sources owned by the primary recipient's parent company without prior written permission from CoreLogic.  Any CoreLogic data used for publication or broadcast, in whole or in part, must be sourced as coming from CoreLogic, a data and analytics company. For use with broadcast or web content, the citation must directly accompany first reference of the data.  If the data is illustrated with maps, charts, graphs or other visual elements, the CoreLogic logo must be included on screen or web site.  For questions, analysis or interpretation of the data contact Lori Guyton at Email Contact or Bill Campbell at Email Contact.  Data provided may not be modified without the prior written permission of CoreLogic.  Do not use the data in any unlawful manner. This data is compiled from public records, contributory databases and proprietary analytics, and its accuracy is dependent upon these sources.

About CoreLogic

CoreLogic (CLGX) is a leading provider of consumer, financial and property information, analytics and services to business and government. The company combines public, contributory and proprietary data to develop predictive decision analytics and provide business services that bring dynamic insight and transparency to the markets it serves. CoreLogic has built the largest and most comprehensive U.S. real estate, mortgage application, fraud, and loan performance databases and is a recognized leading provider of mortgage and automotive credit reporting, property tax, valuation, flood determination, and geospatial analytics and services. More than one million users rely on CoreLogic to assess risk, support underwriting, investment and marketing decisions, prevent fraud, and improve business performance in their daily operations.  The company, headquartered in Santa Ana, Calif., has more than 6,500 employees globally with 2010 revenues of $1.6 billion. For more information visit www.corelogic.com.

CoreLogic is a registered trademark of CoreLogic.

(1) The definition of an above market rate was 5.1%, which is roughly the current mortgage rate of 4.1% plus a 100 basis point refinance trigger.

(2) Low mortgage debt zip codes have negative equity shares less than 10% and high mortgage debt zip codes have greater than 50% negative equity.

SOURCE CoreLogic

Contact:
CoreLogic
For real estate industry and trade media, Bill Campbell, office
Phone: +1-212-995.8057, mobile
Phone: +1-917-328.6539
Email Contact
for general news media, Lori Guyton
Phone: +1-901-277-6066
Email Contact
Web: http://www.corelogic.com