Almost half of all single-family homes with a mortgage in South Florida are currently under water. An underwater home loan is one where the loan balance is greater than the fair market value causing the homeowner to be upside down on the mortgage.
The State of Nevada leads the country in underwater homes, and Las Vegas leads the country. The State of Florida ranks third in the country, and Jacksonville, Tampa and Ocala have the highest percentage of underwater homes in the state.
Since the housing market peaked in 2006, thousands of homeowners have seen their home equity disappear while home prices decreased more than 50%. Because of the decline in home prices, coupled with the loss of home equity, many homeowners have stopped paying their mortgages and simply turned the home over to the bank.
When facing an underwater mortgage, as well as higher property taxes and home insurance, walking away from your home could be extremely tempting to homeowners.
However, walking away from your home does not come without consequences, and often times those consequences are negative.
It is imperative that you understand both the pros and cons associated with walking away from your home. The negative implications could haunt you for years. But the positive ramifications may set you free financially.
There are also often times many alternatives available to you in an effort to avoid foreclosures. Indeed, one such potential option may be to explore the government’s newly enacted and revised re-finance program, i.e. HARP.
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Consider Your Options.
At Alvarez & Barbara, LLP, we represent buyers, sellers, lenders, borrowers, and developers with real estate matters. This experience allows us to understand legal issues from various angles to effectively advocate our clients’ interests. No matter what you or your business’s real estate needs are – think of Alvarez & Barbara, LLP, and contact us for a free consultation.