Report: Mortgage Holders Lost Massive Equity In The Third Quarter

Published by FOX Business | November 8, 2022

The report stated a loss of $1.3 trillion

U.S. mortgage holders saw a massive loss of equity in the third quarter, mortgage-lending software and analytics company Black Knight found.

Black Knight’s Mortgage Monitor Report, released Tuesday, said the total homeowner equity lost in the three-month period amounted to $1.3 trillion. It marked the “largest quarterly decline on record by dollar value and the largest since 2009 on a percentage basis,” company data and analytics president Ben Graboske said in a statement.

Moreover, total homeowner equity had dropped almost $1.5 trillion since May, when Black Knight said it peaked. From May to the end of September, the company said the average borrower lost $30,000.

“While additional declines may be on the horizon, homeowner positions broadly remain strong,” Graboske said. “Overall mortgage holder equity is still $5T (+46%) above pre-pandemic levels, for an average gain of more than $92K per borrower during that period.”

The Mortgage Monitor Report found that less than 500,000 homes across the country are underwater, up roughly 275,000 over a four-month period.

Grabroske stated that “just 3.6% of nearly 53M U.S. mortgage holders are either underwater or have less than 10% equity in their homes – roughly half the share coming into the pandemic.”

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