Florida, and particularly Miami, has a higher average of homes considered to be underwater than the rest of the nation. The term underwater refers to mortgage where the debt is more than what the property is worth.
For the first half of the year, Miami reported 37 percent of homes to be underwater. While the number remains high, it has decreased significantly from the previous year. Home equity increasing is a positive sign of the economy improving.
What does it mean for homeowners?
For homeowners whom have positive equity on their properties it means that they can refinance their mortgage. The interest rates are still fairly low, thus it’s a great time to refinance. Some homeowners may even chose to put their homes on the market for sale. However, it’s best to wait until the property has at least 20 percent extra in equity to cover the expense of selling.
What happens to homeowners who don’t have equity?
The market is improving, so it’s important not to give up. For the 37 percent of homeowners who don’t have equity in their homes and can’t afford to continue making payments there are options. There are loan modification programs to assist homeowners who don’t have enough income to continue making payments on their home or the equity to sell.
If you are worried about the possibility of foreclosure, and need advice on what steps to take to keep your home, contact us for a free consultation.