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A person buys a home for $500,000 with an initial mortgage of $450,000. Over the next year, they make payments that reduce the mortgage balance to $445,000. During the same period, a downturn in the local economy causes the market value of their home to decrease by 15%. Which of the following statements accurately analyzes the homeowner's financial position regarding their property at the end of the year?
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A person buys a home for $500,000 with an initial mortgage of $450,000. Over the next year, they make payments that reduce the mortgage balance to $445,000. During the same period, a downturn in the local economy causes the market value of their home to decrease by 15%. Which of the following statements accurately analyzes the homeowner's financial position regarding their property at the end of the year?