This has been the big question of the past few months. Some financial advisers suggest that borrowers cash out their HELOCs to protect against possible freezes. But, others are suggesting that panic-stricken withdrawals are a bad bet. KSN News reports: “If they are paying interest just to hold that money to me that’s counterproductive,” said Darryl Bauchert [...] [...more]
If you’re relying on a home equity line of credit to keep you afloat during this economic crisis, you may want to reconsider that plan. The Boston Globe explains: “Some families don’t have any cash on hand, but are relying on a home equity line of credit (HELOC) if times get tough. The only problem with that [...] [...more]
Homeowners in almost every state are feeling the effects of the home equity crisis. Those who took out large HELOC loans are now struggling with upside down mortgages and the possibility of foreclosure. But, borrowers in one state are less exposed. Thanks to more strident state laws, fewer Texans are facing these problems. The Houston Chronicle explains [...] [...more]
The mortgage crisis has created an entire new industry: the foreclosure review company. These organizations review clients’ loan documents looking for mistakes. If a mistake is found (which apparently is pretty commonplace with high-risk California loans), the client can use it as leverage to stop the foreclosure proceedings. One such company, CancelYourForeclosure.com, explains their work: “Let us [...] [...more]
Home equity line customers may soon be enjoying a decreased interest rate, if market rumors come to fruition. The Associated Press reports: “Many believe the Fed will ratchet down a key lending rate to banks — now at 2 percent. In turn, the prime lending rate — now at 5 percent — for certain credit cards, home [...] [...more]
What a week. There has been some unprecedented instability amongst major home equity lenders during the past few days. Talk of a bailout, stock plunges, and bank failures have topped the headlines. Now it’s looking like only a handful of major HELOC lenders will come out of this. The next time you go to take out [...] [...more]
After weeks of rumors and speculation, it finally happened - Washington Mutual fell and was promptly purchased by financial giant J.P Morgan. Market Watch reports: “Late Thursday, J.P. Morgan announced an agreement to buy WaMu’s banking subsidiary after the nation’s largest thrift was seized by the Federal Deposit Insurance Corp. [...] [...more]
Over the past couple months, I’ve posted quite a bit about Regulation Z and home equity lender’s responsibilities. HELOC lenders can freeze clients’ credit lines. But, they cannot do so without proper legal cause. The Washington Post recently reports: “This summer, both the Federal Deposit Insurance Corp. and the Office of Thrift Supervision issued guidance to the [...] [...more]
An entire generation is now suffering the consequences of too many home equity line of credit withdrawals. During the housing boom, many in the 50+ crowd took out HELOCs and spent the money on home improvement projects, college tuition for the kids, and shopping sprees. The Center for Retirement Research at Boston College director recently explained [...] [...more]
Many financial analysts speculated that the government would slash the Federal Funds Rate earlier today. But, Federal Reserve chairman Ben Bernanke and his colleagues voted unanimously to keep rates the same (2.0%). A federal rate cut would have resulted in lower interest rates on most home equity lines of credit. Almost all U.S.-based HELOC rates are [...] [...more]
