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How do I get out of a negative equity trap?
The value of my home has dropped dramatically in recent years, and I now owe more on my mortgage than my house is worth. How do I fix my negative equity?
Melanie Johnson · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
I’m so sorry to hear that. Being stuck in a negative equity trap can be uncomfortable and even scary. You can take steps to get out of a negative equity trap by overpaying your mortgage, saving money, and staying put—don’t change homes.
Here’s more on that.
- Negative equity occurs when the value of your home is less than the amount owed on your mortgage. This can occur when house prices fall.
- If your mortgage allows, overpay it by a little extra every month. This will help you get out of debt faster and reduce the amount of interest you pay over the long haul.
- Save money by investing it in the highest interest savings account you can find.
- Unless you absolutely have to move, stay put and wait for house prices to increase.
You may be able to save a little extra by bundling your
home
and car insurance
policies. Jerry
can help you with this! Jerry is an insurance shopper and broker app that will provide you with quotes from some of the nation’s top-rated insurance companies in no time. Just pick the policy you want, and Jerry will take care of the rest. Our customers save an average of $887 per year on car insurance!
Best of luck to you!
View full answer
- Gregory R.
WHY YOU CAN TRUST JERRY
Jerry partners with more than 50 insurance companies, but our content is independently researched, written, and fact-checked by our team of editors and agents. We aren’t paid for reviews or other content.
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