Today's word:
UNDERWATER MORTGAGE
Theme for this fortnight: REAL ESTATE
Theme for this fortnight: REAL ESTATE
A home purchase
loan with a higher balance than the free-market value of the home. This
situation prevents the homeowner from selling the home unless s/he has cash to
pay the loss out of pocket. It also prevents the homeowner from refinancing in
most cases. Thus, if the homeowner wants to sell the home because s/he can't
afford the mortgage payments anymore, perhaps because of a job loss, the home
will fall into foreclosure unless the borrower is able to renegotiate the
loan.
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