Quote:
Originally Posted by RPKESQ
I'm talking about people taking equity loans on their home for improvements, toys, vacations, etc.
This is ridiculous and very harmful to both the "renter to own" and the financial health of our financial system. It should, IMO, be outlawed.
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I will agree that it is generally poor judgment, and possibly frivolous, but how is it harmful? Provided you have the equity to cover the loan then who cares?
And what is the difference between borrowing on a car, or using the home equity to pay for the car? Most people have multiple 'loans', cars, line of credit, credit cards, and a mortgage. Provided they have equity and income, who cares?
If I have a $200,000 mortgage on my $500,000 house I am okay, but if I increase my mortgage from $190,000 to $200,000 to take a holiday that's worse?