When you owe more on your house than it's currently worth, the mortgage is considered underwater. This in itself does not affect your payments, but it's certainly unattractive from an investment point of view. However, if you are struggling with finances, some federal programs, such as the Home Affordable Refinance Program or the Home Affordable Modification Program, might provide help. Before enrolling in the program, the agent probably will ask you how far underwater you are to determine your eligibility for a loan modification. This figure may be expressed as a dollar value, loan-to-value ratio or a value-to-loan percentage.

Call your mortgage company and ask for the current payoff amount on the loan. If you have a second mortgage, add that total to the first mortgage. As an example, if you have a $100,000 payoff on your first mortgage and $40,000 on the second, add the figures to derive a total debt of $140,000.

Find the current value of your home. The most accurate way to do this is by hiring an appraiser, but they don't come cheap. Another option is estimating the value by comparing the sale prices of comparable houses that recently sold in your neighborhood.

Subtract the total debt from the current value. If the result is negative, your mortgage is underwater. Continuing with the example, if your house was valued at $120,000, subtract $140,000 from $120,000 to get negative $20,000. A negative number tells you the mortgage is underwater by $20,000.

Divide this difference by the value of the house and multiply by 100 to express the underwater total as a percentage. In the example, divide negative $20,000 by $120,000 and multiply by 100. This gives you a negative percentage of 16.7. As before, a negative percentage tells you it's underwater.

Divide the total debt by the value to calculate the loan-to-value ratio. In the example, divide $140,000 by $120,000 to calculate a loan-to-value ratio of 1.17. Multiply by 100 to express this ratio as 117 percent. Unlike the previous calculations, you won't get a negative number. Instead, the mortgage is considered underwater if its ratio is greater than 1 or its percentage is greater than 100.

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