Finance
A Pennsylvania homeowner whose property is worth less than the mortgage balance is described as being:
AIn financial default
BUnderwater or upside-down in their mortgage✓ Correct
CIn technical foreclosure
DSubject to automatic refinancing by PHFA
Explanation
An underwater (upside-down) mortgage occurs when the outstanding loan balance exceeds the current market value of the property. This limits the owner's options — they cannot sell without a short sale (lender approval) or covering the deficiency out of pocket. Underwater positions are common after market downturns.
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