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Old 02-08-2013, 02:19 PM
 
Location: Whittier, CA
494 posts, read 1,725,195 times
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A interesting case of history repeating itself, the American addiction to over-spending and materialism never ceases to amaze!

Americans Are Tapping into Home Equity Again - Yahoo! Finance

"I would guess that most of the current home equity line borrowing is quite prudent. We know that it is being very conservatively underwritten with plenty of equity," said Guy Cecala, editor of Inside Mortgage Finance.

yeah SURE isn't that what they also said the first time around? that everything was super safe and nothing would ever implode?
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Old 02-08-2013, 02:32 PM
 
756 posts, read 645,440 times
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Americans are tapping into home equity again, eh


Not this American… $$$$$$
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Old 02-08-2013, 04:27 PM
 
Location: Great State of Texas
86,068 posts, read 76,616,443 times
Reputation: 27642
Prudent ? Prudent ? LOL, oh the irony of it all.
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Old 02-08-2013, 06:19 PM
 
Location: Fairfield, CT
6,327 posts, read 9,283,200 times
Reputation: 7302
Home equity loans are a tool of the devil.
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Old 02-08-2013, 06:56 PM
 
28,461 posts, read 76,034,829 times
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Default Compared to what?

Quote:
Originally Posted by dazzleman View Post
Home equity loans are a tool of the devil.
And non-deductible 21% credit card interest is "angle's bounty" ?

Look, if you are fortunate enough to never need / want anything more than the cash that you stuffed in your mattress can buy then sure "cast stones" at those people that use credit recklessly, but the bottomline is without SOME KIND OF FINANCING probably 75% of "long term capital expenditures" would NEVER happen and that would mean less jobs for autoworkers, appliance makers, home builders and MILLIONS of related laborers...


Now when it comes to stocking my bunker for the zombie apocolypse you are DARN TOOTIN' I will have nuthin' but gold bullion and bullets down there with me as currency. AND don't come a knockin' !
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Old 02-08-2013, 07:41 PM
 
Location: Fairfield, CT
6,327 posts, read 9,283,200 times
Reputation: 7302
Quote:
Originally Posted by chet everett View Post
And non-deductible 21% credit card interest is "angle's bounty" ?

Look, if you are fortunate enough to never need / want anything more than the cash that you stuffed in your mattress can buy then sure "cast stones" at those people that use credit recklessly, but the bottomline is without SOME KIND OF FINANCING probably 75% of "long term capital expenditures" would NEVER happen and that would mean less jobs for autoworkers, appliance makers, home builders and MILLIONS of related laborers...


Now when it comes to stocking my bunker for the zombie apocolypse you are DARN TOOTIN' I will have nuthin' but gold bullion and bullets down there with me as currency. AND don't come a knockin' !
More restrictive "home improvement loans" were better -- they required the loan to be used to improve the house. Taking out a home equity loan and spending the money on a vacation isn't a long term capital expenditure.
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Old 02-09-2013, 11:27 AM
 
505 posts, read 689,681 times
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I don't see an issue with people responsibly using home equity to make improvements to their house. It's probably cheaper than moving if you need a little more space and is certainly cheaper than putting a new roof on a credit card.

Using home equity to finance consumption is just plain dumb. One of the worst ideas I saw circa 2005 was a home equity line of credit that was linked to a debit card. You'd swipe the card and draw on your line of credit. Took using your house as an ATM to a whole new level. Hopefully that isn't coming back anytime soon...
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Old 02-09-2013, 11:40 AM
 
Location: Fairfield, CT
6,327 posts, read 9,283,200 times
Reputation: 7302
Quote:
Originally Posted by shamrock847 View Post
I don't see an issue with people responsibly using home equity to make improvements to their house. It's probably cheaper than moving if you need a little more space and is certainly cheaper than putting a new roof on a credit card.

Using home equity to finance consumption is just plain dumb. One of the worst ideas I saw circa 2005 was a home equity line of credit that was linked to a debit card. You'd swipe the card and draw on your line of credit. Took using your house as an ATM to a whole new level. Hopefully that isn't coming back anytime soon...
Exactly.
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Old 02-09-2013, 05:44 PM
 
Location: Great State of Texas
86,068 posts, read 76,616,443 times
Reputation: 27642
If I were buying a new appliance and didn't have the money I would not take out a home equity line.
I would finance through the store.

I would not borrow against my home just like I would not borrow against my 401K.

I knew too many middle class folks that got themselves in real trouble back in 2008 doing just that.
They must have forgotten that what goes up can also go down.
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Old 02-10-2013, 09:48 AM
 
343 posts, read 653,999 times
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A good rule of thumb is don't use a home equity loan to pay for anything that won't last as long as your home.
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