Mortgage Equity Withdrawal - MEW

AAA

DEFINITION of 'Mortgage Equity Withdrawal - MEW'

The removal of equity from the value of a home through the use of a loan against the market value of the property. A mortgage equity withdrawal (MEW) reduces the real value of a property by the number of new liabilities against it.

INVESTOPEDIA EXPLAINS 'Mortgage Equity Withdrawal - MEW'

During times of economic boom and rising home prices, mortgage equity withdrawals are a common practice. If the value of the property increases at the same rate as the mortgage equity withdrawals, the real value of the home remains constant. Issues arise, as they did in the financial crisis of 2007-2009, where home prices decrease to below the value of the liabilities outstanding - this creates a negative real value of the property to the owner.

RELATED TERMS
  1. Home-Equity Loan

    A consumer loan secured by a second mortgage, allowing home owners ...
  2. Home Equity

    The value of ownership built up in a home or property that represents ...
  3. Home Equity Line Of Credit - HELOC

    A line of credit extended to a homeowner that uses the borrower's ...
  4. Home Equity Conversion Mortgage ...

    A type of Federal Housing Administration (FHA) insured reverse ...
  5. REX Agreement

    An alternative to a home equity line of credit (HELOC) and refinancing ...
  6. Asset Liquidation Agreement (ALA)

    A contract between the Federal Deposit Insurance Corporation ...
Related Articles
  1. Home-Equity Loans: What You Need To ...
    Options & Futures

    Home-Equity Loans: What You Need To ...

  2. How Interest Rate Cuts Affect Consumers
    Credit & Loans

    How Interest Rate Cuts Affect Consumers

  3. Protect Yourself From HELOC Fraud
    Credit & Loans

    Protect Yourself From HELOC Fraud

  4. Learn How To Lower Your Second Mortgage ...
    Investing

    Learn How To Lower Your Second Mortgage ...

Hot Definitions
  1. Gross Rate Of Return

    The total rate of return on an investment before the deduction of any fees or expenses. The gross rate of return is quoted ...
  2. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  3. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  4. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  5. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  6. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
Trading Center