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Number of 'underwater' mortgages on decline in Minnesota


In sync with a nationwide trend, the number of Minnesotans "underwater" on their mortgages is on the decline, Minnesota Public Radio reports.

Citing a study from California research firm CoreLogic, MPR says about 10 percent of mortgaged properties in Minnesota were underwater in 2013, down from 16 percent in 2012.

Nationwide, the number of homeowners with negative equity was 13 percent at the end of 2013, down from 22 percent the year before, according to the CoreLogic study.

Negative equity is often referred to as “underwater” or “upside down" because borrowers owe more on their mortgages than their homes are worth, the firm says.

With the positive news, the director of real estate programs at the University of St. Thomas expects more houses to come back onto the market.

"As they come into a situation where they have some equity now, I think you're going to start to see more of those houses come on to the market now to help us with the inventory situation," Herb Tousley told MPR.

Housing inventory in the Twin Cities is currently at a 10-year low, MPR says.

Last month, Minnesota made a list of states with the lowest number of foreclosures.

USA Today said the state was No. 7 on its list of “healthiest foreclosure markets," which was determined by the level of foreclosure inventory.

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