The housing crisis made us aware of the housing that is "underwater" or has negative equity. Like a good news bad news story there is both positive equity and negative equity. The government now calculates home equity and estimates that 22 percent of mortgages are "underwater." The flip side of this story is that 78 percent of mortgages are "above water" or have positive equity .
A clean energy reverse mortgage may be an important financial innovation given our dire environmental situation. Between government needing to act and the fact that these would be very solid loans make CERM a safe yet exciting innovation. We could apply the often quoted Chinese saying about crisis and opportunity by making the housing crisis into an opportunity if we harnessed positive equity.
