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What is Negative equity

A state of affairs when a property is bought and the value of the property falls below the mortgage amount outstanding. e.g. if a property was bought for 350,000 where a mortgage of 300,000 was taken, and the price of the property fell to 250,000. The owner will be in negative equity by 50,000

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Term created / updated 2005-07-16 23:12:15

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