Daily Archives: June 16, 2015

More Borrowing = More Bankruptcy

I guess my business is going to get better, as bankruptcy moreDEBTmoreBANKRPTCY

cases always go up some time after borrowing goes up.

And consumers are borrowing more.

In April, consumer credit increased at a seasonally adjusted annual rate of 7-1/4 percent. Revolving credit increased at an annual rate of 11-1/2 percent, while nonrevolving credit increased at an annual rate of 5-3/4 percent.

Moving on to that old bugaboo, home equity loans.

Which is just a marketing term, home equity loan, that is.

They are really second mortgages.  Lots of folks argue with me when I tell them that, they insist they only have one mortgage, this other thing is a home equity loan.

So, the marketing term has worked!  People do not realize that loan is a lien on their home.

Although, they also told us, take advantage of that equity in your home!  Why let it sit there!

Sign some papers and spend away!  No need to worry, home values always go up!  Interest rates are at historic lows!

We heard that last one for years.

The Wall Street Journal reports that, lo and behold, more Home Equity Lines Of Credit (HELOC) are in default.

Because part of the marketing was, ten year, interest only payments.  Then you can refinance, because, like we told you, home values only go up.

Except home values went boom in 2007-2008.

Homeowners who signed up for Helocs in 2004 were 30 or more days late on $1.8 billion worth of outstanding balances four months after principal payments began, according to data provided to Journal by credit-reporting firm Equifax.

Read Latest Breaking News from Newsmax.com http://www.newsmax.com/Finance/StreetTalk/home-equity-loans-borrow-delinquent/2015/06/09/id/649574/#ixzz3cmbGQx1U
Urgent: Rate Obama on His Job Performance. Vote Here Now!
I am not sure how these chief economist guys get their gigs, but the quotes the media uses seem to generate from Captain Obvious.
“There are some early signs of choppy waters ahead,” said Dennis Carlson, deputy chief economist at Equifax.
Duh.
More from the Captain:
Borrowers delinquent on their Heloc were found more likely to also be delinquent on other loans. Global information services group Experian looked at delinquencies on other consumer debt like mortgage, credit cards, auto loan and auto lease.

(above quotes from the NewsMax site)
If these, or any other debt problems sound familiar, how do you spell debt relief?
K-U-R-T- O-K-E-E-F-E-

 

 

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