Homeowners in outcry over their HELOCs – San Jose Mercury News
Homeowners in outcry over their HELOCs – San Jose Mercury News
A growing number of homeowners in the Bay Area and around the country are finding themselves unable to borrow against the equity in their home, as beleaguered banks take away a financial safety net many homeowners had counted on.And now some of those homeowners are fighting back.Cupertino homeowners Jeff and Jenifer Schulken filed suit this summer against JP Morgan Chase, charging that the bank unfairly terminated their home equity line of credit even though the couple provided documents showing that they could repay the money.”They weren’t even interested in verifying whether I could pay it back. They just want these things off the books,” Jeff Schulken said, adding he had $160,000 available on his credit line in March when he got a letter from Chase asking for tax documents. He sent them immediately, and was told when he called the bank that the inquiry was only a formality and his equity line was not in jeopardy.”The next morning, I got online and we had zero available credit,” he said.A spokeswoman for Chase said the company would not comment on pending litigation.
In the early part of this decade, home equity lines of credit, or HELOCs, were a regular feature of Silicon Valley homeownership. Longtime owners sitting on a few hundred thousand dollars in equity could easily borrow against it to remodel, pay their children’s college tuition, or use as a rainy-day fund.
Thanks to Burbed reader Herve for this find.
Let’s call a spade a spade – this is our arch nemesis’ (Manhattan) attempt to cut us down… to demoralize us. It’s psychological warfare at its best.
They’ve seen the threat and now they’re resorting to below-the-belt tactics like this.
But. The Real Bay Area will prevail.
Using our world famous innovation, our smart people, our great weather, we will find ways to extract the equity from our homes.
We will not be deterred from our unifying goal of finally beating the entire New York City (we’ve already beaten 4/5′s) in having the highest housing prices.
I know we can do it.
September 13th, 2009 at 10:52 am
Last time in history HELOCs were popular was during the RE boom of the 1920s.
September 13th, 2009 at 11:27 am
Boo hoo. At least the banks are starting to be responsible in some aspects of lending.
September 13th, 2009 at 12:35 pm
I just re-financed, and haven’t had any problem with getting credit. The process took a little longer, and the bank used its own appraiser. That’s about the main difference. The appraiser even said she had a great time touring my house.
September 13th, 2009 at 12:47 pm
I have a heloc with my work’s CU. I’m shocked it’s still open, and with the same amount available as the day I opened it.
I have to admit, I bought in to the strategy of having zero savings but a heloc to fall back on. Sensing the pending doom, I’ve reversed that strategy. Now I actually have more in savings than the balance I carry on the heloc.
September 13th, 2009 at 12:55 pm
“The appraiser even said she had a great time touring my house.”
Of course you did. Two bubbleheads talking about garbage? What could be better!
September 13th, 2009 at 1:02 pm
I just refinanced in July. The appraiser did a drive-by – it was so wonderful on the outside, apparently he figured he’d faint from delight if he came inside.
Getting the money from the bank was easy. They said they only refi for up to 75% LTV now; it didn’t matter to me since I didn’t take any cash out.
September 13th, 2009 at 6:30 pm
I just refinanced in August. The appraiser was Carmen Electra moonlighting in her seldom known real estate role.
Getting money from the bank was easy. Carmen did a nice aerobic striptease pole dance in the center of B of A’s Willow Glen lobby. The loan officer said he had a great time loaning me money and watching Carmen gyrate. Saved him a Viagra pill later that night.
September 13th, 2009 at 9:20 pm
I hadn’t noticed the article was spadeless
September 14th, 2009 at 7:59 am
I’ve always thought of the idea of using your home as an ATM machine as totally crazy, yet I know so many people who do it. Somehow I don’t exactly feel that sorry for the people in this story.
September 14th, 2009 at 8:49 am
I agree with you bob, I don’t get why this is such a big deal. I didn’t realize so many people use them.
When I first bought my current house, we had a HELOC for part of the down payment because we hadn’t closed on our old house yet. As soon as we got that money, I paid off the HELOC and canceled it. The bank was aghast that I wouldn’t keep it open “just in case.” Just in case of what? I lost my mind and wanted to pay a premium interest rate that changed every month? Nah, I’m cheap in that way.