One in five underwater

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One out of five U.S. mortgage holders is now underwater, according to First American Core Logic’s latest review of 45 million mortgages in its database.

The study covers the fourth quarter of 2008, during which the percentage of mortgage holders owing more than their properties were worth climbed to 20%, two percentage points higher than the 18% rate the previous quarter.

In the Los Angeles area, 307,153 -- or about 23% -- of mortgages were upside down.

California’s 30% rate of negative equity places it in a tie for fifth-place with Florida. Arizona (32% underwater) and Michigan (40% upside down) were more distressed, but nowhere near Nevada, where 55% of mortgaged properties are worth less than their loan amounts. In Nevada, the average loan to value is now 97%, meaning the average mortgage holder has $8,000 in equity.

-- Peter Y. Hong