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An asset is considered to have negative equity when its value falls below the mortgage balance. This means you owe more on the mortgage than the value of the property.\u00a0<\/b><\/p>
Though this isn’t always avoidable, understanding why it happens can help you figure out the best way to turn it into positive equity.<\/b><\/p>
To determine if a home’s equity is negative or positive, all you need to do is subtract your mortgage balance from the current property value.\u00a0<\/b><\/p>
For example, if your home is worth $400,000 and you have a mortgage balance of $250,000, you have $150,000 in positive equity.\u00a0<\/b><\/p>
On the other hand, if you sell your home for $200,000 and owe the lender $250,000, you have a $50,000 negative equity.<\/b><\/p>\t\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t