About 28% of the recent foreclosures in Bergen County seem to be a result of people cashing out their equity. Of the 135 homes that the foreclosure process was initiated that had judgments against them in excess of the average purchase price, the average price was $324,838 but the average judgment is $486,531. That's almost 50% more than what they paid for the house.Bergen is not great for putting the mortgage documents and other public records on line - so the calculation is based the foreclosure records. On a side note - even the Morris County database which appears to be the best in the State is cumbersome and time consuming. Doing research at the county clerks office must be so much more difficult. But the difference between the prices and the judgments show significant extractions were taking place.
People throughout the country were using equity to live a lifestyle they could not afford otherwise. Everyone seemed to think they were clever investors because of the skyrocketing property values. And the pressures to own property during the bubble were enormous. One hope for Bergen County and the rest of Jersey is that we will not have the housing fall out that is occurring in Florida, California, Nevada and Arizona. But this is evidence that equity extraction is going to have affects even in Bergen County.