For months, HELOC borrowers have been complaining about frozen and reduced home equity lines. Now, a concerned congressman is asking lenders some tough questions. Representative Dennis Kucinich called the HELOC freezes “very disturbing.” “People have had their home equity lines suspended whether or not their credit is good or not, and whether they have sufficient equity in [...] [...more]
In the midst of HELOC line reductions and increasingly strict lending standards, a new study from J.D. Power and Associates comes as a surprise. Apparently, HELOC customer satisfaction is up this year: “Despite an economy affected by a stagnant housing market, decreasing home values and upheaval among lenders, overall customer satisfaction with the home equity line [...] [...more]
Lending standards have tightened. But, if you still qualify to take out a HELOC, you may be able to snag a super deal. Since HELOC rates are tied to the federal funds rate, you’re likely to have a very low monthly payment. Here are a few HELOC deals out there right now, as discovered by TheStreet.com: In [...] [...more]
If you’re a homeowner looking to purchase a new property, you may be able to use a home equity line of credit (HELOC) as a down payment. In order for this to work, your current property must have a significant amount of equity (usually at least $20,000 worth). If you are planning to sell your current [...] [...more]
Many home equity lines offer an interest-only feature. Interest-only HELOCs are risky to the borrower; however they do provide more manageable monthly payments during the first few years. Here’s how these credit lines work: First - The interest-only HELOC is opened. The borrower agrees to a set number of years for the withdrawal period and a set [...] [...more]
This week, Comptroller of the Currency John C. Dugan urged banks to consider tougher underwriting standards on home equity lines of credit (HELOCs). In his speech, he suggested that banks should cut back on many of the competitive HELOC allowances used by underwriters during the housing boom: “Home equity loans and lines of credit grew dramatically [...] [...more]
As HELOC rates have nosedived, average rates on home equity loans have gone up. Some HELOC customers have suffered through line freezes and reductions, but many others are taking advantage of the low rates made possible by federal funds slashes earlier this year. Here are the national overnight averages calculated by Bankrate.com: $30,00 HELOC - 4.82% HEL - 7.71% $50,000 HELOC [...] [...more]
Recently, I’ve posted quite a bit about the driving forces behind the HELOC freeze. Although these explanations can’t change anything, borrowers like to have some idea of why their lenders are acting unusually. Despite these explanations, a few borrowers want more. We still receive a lot of emails asking questions like “How did this whole HELOC [...] [...more]
Over 400,000 HELOC borrowers have had their lines reduced and HELOC lenders are more unpredictable than ever. What’s the reasoning behind this recent instability? HELOC lenders have lost more money on these loans than ever before. Although home equity lines make up a small percentage of the mortgage market, their loss hits banks harder [...] [...more]
If you’re a homeowner, it’s important to stay aware of mortgage scams such as HELOC identity theft. According to a recent Consumer Affairs article, home equity identity theft has become increasingly common. Here’s how the scam works: “Some con artists steal consumers’ identities to drain Home Equity Line of Credit (HELOC). These HELOC loans differ from standard [...] [...more]
