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Underwater Mortgages Today, Foreclosed Manufactured Homes Tomorrow

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By : John Cutts    99 or more times read
Last week, Mecklenburg County residents received the latest tax values and found out that their worst nightmare has come true – they now owe more in mortgage than what their homes are worth. Sadly, a lot of underwater homeowners these days decide to walk away and allow the houses to end up as foreclosed manufactured homes.

Based on the latest report from CoreLogic, 14 percent of 52,000 households in the said Charlotte area were already underwater during the third quarter of 2010. Compared to the same period in 2009, it is 9.7 percent higher. The problem with declining home values is that it could take some time for the market to recover and many of the homeowners end up thinking they can no longer do anything about their situation. Some even consider walking away and allowing their homes to join the other foreclosed homes in Charlotte.

The county’s revaluation is done according to state law to ensure that homeowners pay the right amount in property taxes. Of course, the amount will be based on what the property is currently valued at in the open market.

The situation in Charlotte is not unique for all over the state, but the number of underwater homeowners has become a concern. The large inventory of foreclosed homes in North Carolina could even be attributed to the fact that 17 percent of all its mortgages were underwater.

Nationally, the story is the same. The highest percentage of underwater mortgages is concentrated in the five states which have the most foreclosed manufactured homes filings. These are Nevada, Michigan, Arizona, California, and Florida. Nevada took the top spot when it comes to having the most number of underwater mortgages, with almost two out of three borrowers owing more compared to their home’s value.

More and more Charlotte residents are becoming worried about the adverse effects of having a high underwater mortgage percentage. Many feels helpless as they watch their neighbor’s home stay on the market for a long time or worse end up in foreclosure listings.

Real estate experts are looking at the growing number of foreclosed manufactured homes in the market as well as increasing short sales activity as the reasons behind declining home prices. Last year, Mecklenburg County noted that 50 percent of home sales transactions involved a home in foreclosure or in pre-foreclosure.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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