Home Equity Loans and Lines Trouble Banks

You've heard about foreclosures due to risky mortgages. The problem applies to second mortgages as well as loans used to buy a home. Banks are reporting increasing delinquencies on second mortgages such as home equity loans and home equity lines of credit (see MarketWatch.com).

If you used your home as an ATM and it's coming back to haunt you, be proactive. Just like the folks suffering from rising interest rates and falling home values, you need to act fast. Contact your lender if you see trouble on the horizon and investigate your options.

You may be able to restructure your loan before you start missing payments and dinging up your credit. Or, you might qualify for some type of workout program. Just be proactive and find out what your options are before they start drying up.

Further reading:

• High Risk Mortgages
• How Second Mortgages Work
• How Debt Workout Programs Work