Tens of thousands of people have been getting letters informing them that their HELOC loan is no longer available or has been substantially reduced. Yep, fine print at it’s best. You may recall how these same banks offered these loans at “no-cost” and marketed them as a great tool for you to use for college, cars, home improvements and even credit card debt. It sounds like their irrational exuberance has come back to bite their tails just a bit.
Those that don’t have or didn’t get a “second” loan on their home will now find it much more difficult to do so. Countrywide, Chase, Wells Fargo, BofA, WAMU appear to be “reviewing” their guidelines in this market. Before, they made it almost too easy, now, they might be too difficult but hopefully, we will soon be back to “normal.”
If you have questions about the availability of your funds, you might want to call your bank. This is relatively new and a lot of them are just getting started. The fact that you haven’t received a letter yet, doesn’t necessarily mean you still have all of your funds available.
MSN recently ran this story about lenders cutting off the home equity tap that had some pretty good info. Take a look..