Seriously Underwater Mortgages Drop in 4th Quarter

February 8, 2018

Ahead of the Mortgage Bankers Association’ National Delinquency Survey release, ATTOM Data Solutions, Irvine, Calif., said 9.3 percent of all U.S. properties with a mortgage were seriously underwater (LTV of 125+) at the end of the fourth quarter, down from 9.6 percent a year ago.

The company’s 2017 U.S. Year-End Home Equity and Underwater analysis said it marked the smallest year-over-year decrease in share of seriously underwater properties since ATTOM began tracking in 2012.

The report said 25.4 percent of all U.S. properties with a mortgage were equity rich (LTV of 50 or less) at the end of the fourth quarter, up from 24.6 percent a year ago, the smallest year-over-year increase in share of equity rich properties since Q3 2015.

ATTOM said the share of homeowners with at least 20 percent equity dropped by 1.1 percentage points from a year ago, while the share of homeowners with between 10 percent equity and 10 percent negative equity increased 1.1 percentage points from a year ago.

“This indicates homeowners are increasingly leveraging their equity to sell and move up into another home or by refinancing,” ATTOM said.

MBA releases its 4th Quarter National Delinquency Survey this morning, Feb. 8.

The NDS, conducted since 1953, covers 39 million loans on one- to four- unit residential properties. Loans surveyed are reported by more than 100 lenders, including mortgage bank, commercial banks and thrifts.

MBA Vice President of Industry Analysis Marina Walsh will provide commentary and analysis. MBA NewsLink and MBA Servicing NewsLink will provide coverage.