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The MReport Webcast: Tuesday 3/24/2015

Over 20 of the 51 largest markets are showing many underwater homes are not rising in value. Now, the rate of homeowners who owe more on their mortgages than their home is worth has stalled and is increasing in some areas, according to a report from Zillow. Florida and the Midwest have some markets with more than a quarter of mortgaged homes underwater. The national negative equity rate is 16 point 9 percent as of the fourth quarter of 2014. Zillow Chief Economist Stan Humphries says higher negative equity rates have become the new normal.

Data shows less valuable homes are more likely to be underwater. In Atlanta, 49 percent of homes in the bottom-third of home values are in negative equity, compared to 11 percent of mortgaged homes in the highest valued third. Among the large cities, Virginia Beach, Jacksonville, Las Vegas, and Atlanta had the highest rates of negative equity. San Jose had the lowest rate of negative equity at 4 percent, with Dallas-Fort Worth, San Francisco, Denver, and Houston all showing lower rates as well. Cities including Cincinnati, Kansas City, and Cleveland all had higher rates near 20 percent.

Ocwen Financial is responding to criticism of its mortgage servicing practices. In a letter to 119 trustees and master servicers released Monday, the company said it has yet to receive proper data to support claims that Ocwen “breached the standard of servicing called for by the agreements.” In January, a group of Residential Mortgage Backed Securities investors issued a notice on Ocwen’s alleged non-performance. Ocwen claims the notice is a part of a long campaign by the RMBS investors to force more home foreclosures and fewer loan modifications.

About Author: Jordan Funderburk

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