Tool takes into account rising home values to pinpoint breakeven date
By plugging in some personal information such as when you bought your home and your mortgage data, he tells me the calculator will inform you how much underwater you are by thousands of dollars, by what percentage, and will give you a time in the future when you will no longer be underwater after taking into consideration the process of amortization.
"You are going to be paying your loan down even if your home never recovers value, so eventually your mortgage will start to disappear and you will find yourself back at breakeven," Gumbinger said. "In addition, home prices might actually change at some point in the future, so you can say, for example, if I have a 1 percent appreciation annually over the next couple of years, how does that change the picture, how much sooner will I be out from underwater?"
I asked Gumbinger why HSH decided to create the app.
"It's a simple answer," he said. "We have been in this underwater circumstance for a number of years now. If I was a homeowner who was underwater and trying to plan where the hell I'll be in the future, I would want to know when I'm not going to be underwater anymore."
So, nationally, how long will we be in this "underwater circumstance"?
"It's a very deep hole," Fleming said, "and it is going to take a long time to work our way out of this. That fact that we are working our way out is better than not working our way out. It's not to say that things will get back to normal -- if anyone can argue what is normal these days."
He added, "Negative equity is going to be around for a number of years for many borrowers. For the hardest-hit borrowers in places like Las Vegas, things are getting better but negative equity is not going to disappear quickly."
Steve Bergsman is a freelance writer in Arizona and author of several books. His latest book, "Growing Up Levittown: In a Time of Conformity, Controversy and Cultural Crisis," is now available for sale on Amazon.com.
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What's Your Home Worth?
Here come the ‘boomerang buyers’