A new loan product called a “shared equity agreement” allows borrowers to take out money and pay nothing back until they sell their property. Sound too good to be true? That’s because it is. Here’s the catch: the borrower must agree to pay back the money borrowed plus half of the home’s appreciation value between the [...] [...more]
Recently, there’s been a lot of talk about the lack of equity in American homeownership. While home equity loans such as HELOCs allowed people to pay for college and afford property improvements, they were also a drain on the economy. Hot Property reports: “…in at least 63 years, the amount of equity we have in our homes [...] [...more]
Taking out a home equity line of credit (HELOC) is now quite difficult. Those who planned to tap their equity are considering other borrowing options, such as credit cards. A recent Associated Press article explains: “Net home equity extraction fell nearly 60 percent from a year earlier to $205 billion in the first quarter, according to Merrill [...] [...more]
Most home equity lenders claim to have some sort of appeal process for borrowers facing line reductions. According to a Wall Street Journal article, Bank of America is willing to reconsider their HELOC freeze decisions. If the borrower can prove that their property has not lost as much equity as believed, the lender may be able [...] [...more]
During the housing boom, many borrowers took out home equity lines of credit (HELOCs) in order to fund property renovations. Now, HELOC cut backs are forcing borrowers to reconsider these improvements. The Wall Street Journal reports: “All this is dinging the remodeling industry. According to Harvard University’s Joint Center for Housing Studies, spending on home remodeling dropped [...] [...more]
A recent study shows that baby boomers may not be able to rely on their home equity as a source of retirement funds. Market Watch reports: “The collapse of the housing bubble will likely have drastic implications on the wealth and retirement of certain baby boomers, according to a report Tuesday by the Center for [...] [...more]
Recent data shows that home prices have made a record year-over-year drop, declining by a whopping 15.3%. This is bad news for HELOC borrowers who risk home equity line reductions from lenders. CNN Money reports: “The overall price declines reported by Case-Shiller have been remarkably consistent over the past two years. Prices on the 20-city index have [...] [...more]
HELOC borrowers may soon have a new line of protection against identity theft. A law coming into effect later this year requires banks to add security measures fighting against identity thieves. Soon all banks offering home equity line of credit loans will need to have an identity protection program. The Chicago Tribune reports: “One of the schemes [...] [...more]
Earlier this week, Washington Mutual announced that it will no longer offer Mortgage Plus loans. Previously, these loans were use to combine traditional mortgages with a HELOC option. Forbes.com reports: Washington Mutual late Wednesday said it will commit an additional $1 billion to a fund intended to help eligible subprime mortgage borrowers and that it will trim [...] [...more]
If your home equity line of credit is reduced, you may have an even bigger problem on your hands. Reduced HELOCs often result in decreased credit scores, which can make it more difficult to take out loans, qualify for credit cards, or even refinance your home. Holden Lewis reports: “Your bank sends you a letter, telling you [...] [...more]
