Homeowners in the US who obtained home equity loans for further financing account for 40 percent of all borrowers who are now underwater, according to the data revealed by CoreLogic.
The data analytics company noted that 10.9 million (22.7 percent) of all residential properties were underwater in Q1 2011, a decrease from 11.1 million in the previous quarter.
It added that around 2.4 million borrowers hold less than five percent equity, which places them at higher risk since they are near-negative equity on their properties.
“Together, negative equity and near-negative equity mortgages accounted for 27.7 percent of all residential properties with a mortgage nationwide,” CoreLogic said. In the fourth quarter, these two categories comprised 27.9 percent.
Meanwhile, Nevada registered the highest percentage of underwater properties, with 63 percent of all home loans valued higher than the properties are worth.
Arizona and Florida followed with negative equity rates of 50 percent and 46 percent respectively.
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