2007-12-30 08:04:28 · 4 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
Losing your equity means that you have:
A) Borrowed too much against your house
B) Your property is not worth what you paid for it (many people are experiencing this now)
C) Neighborhood has gone down due to crime or lack of amenities.
Your question should have said what puts your equity at risk?
2007-12-30 08:23:18 · answer #1 · answered by Your #1 fan 6 · 2⤊ 0⤋
They major risk factor of losing your equity is becoming "upside down" on your mortgage. This means that you owe the bank more than the house is worth. The risk of this has increased greatly with the lax lending standard of the last few years. Many people were given mortgages with 3% or 0% down payments. Since there was no equity in the house, as soon as the prices of the homes dropped the owners became "upside down" on the mortgage. If the owners stop paying the bank, the bank will foreclose but may not be able to sell the house for enough to cover what is owed on the loan.
2007-12-30 08:49:39 · answer #2 · answered by Patrick 5 · 1⤊ 0⤋
If you lose the home's equity, such as by re-financing and taking all the money out, it will probably take years in this horrible real estate market we have now for the house to recuperate same value.
2007-12-30 08:45:05 · answer #3 · answered by 1-2informationalways 1 · 1⤊ 0⤋
What?
2007-12-30 08:19:37 · answer #4 · answered by hottotrot1_usa 7 · 1⤊ 1⤋