Report: Home mortgages gain ground, though some weakness remains

Home mortgages in Northern Colorado continued their return to health last year, though slowing price appreciation, among other factors, caused an increase in troubled loans in some cities.
In Greeley, 13.1 percent of all residential properties with a mortgage were underwater, or in negative equity, in the fourth quarter of 2013, compared with 13.5 percent in the quarter before, according to the latest data from CoreLogic.
Negative equity means that borrowers owe more on their mortgages than their homes are worth. This can can occur because of a decline in value, an increase in mortgage debt or a combination of both.

In Fort Collins, the percentage of underwater mortgages was much lower overall than in Greeley, but increased slightly. In the fourth quarter, 3.8 percent of residential properties were worth less than than their mortgages, compared with 3.7 percent in the third quarter.

Nationwide in 2013, 4 million homes returned to positive equity, according to California-based CoreLogic, but 13.3 percent of homes had negative equity in the fourth quarter, compared with 13 percent in the third quarter.

This is largely attributed to a slowdown in the appreciation of home values at the end of 2013 caused by slight declines in the level of activity in the residential real estate market.

Overall, the picture has improved for homeowners, according to CoreLogic.

“The plight of the underwater borrower has improved dramatically since negative equity peaked in December 2009 when more than 12 million mortgaged homeowners were underwater,´ said Mark Fleming, chief economist for CoreLogic in a statement.

“Over the past four years, more than 5.5 million homeowners have regained equity, reducing their risk of foreclosure and unlocking pent-up supply in the housing market,” he said.