Negative equity occurs when the value of an asset used to secure a loan is less than the outstanding balance on the loan. In the United States, assets (particularly real estate, whose loans are mortgages) with negative equity are often referred to as being "underwater", and loans and borrowers with negative equity are said to be "upside down".
People (and companies) may also have negative equity, as reflected on their balance sheets.
Read more about Negative Equity: In An Asset, Negative Net Worth
Famous quotes containing the words negative and/or equity:
“A negative judgment gives you more satisfaction than praise, provided it smacks of jealousy.”
—Jean Baudrillard (b. 1929)
“If equity and human natural reason were allowed there would be no law, there would be no lawyers.”
—Christina Stead (1902–1983)