Here’s a little story for those readers with credit lines on their houses'. I have(had) 250k with WaMu. I have never used it. Last week I got a letter stating that my line was being suspended because M and I put our title in a trust. Keep in mind, that this was with the approval of my WaMu loan broker. If they're so concerned about the title change, I wonder why they don't call the first loan too.
My friend Jesse got a letter the same day from Citibank stating that because his property was in zip code 94114(SF) and values had dropped, they were suspending his credit line. Now keep in mind that SF is one of the few cities in the US which is still appreciating.
Ok, so what’s going on under the surface? Today, I get a letter from WaMu offering me a new first loan with a cash take out feature of up to 53K. They propose that for 53k, I’m going to walk away from a 5%, 15 year, fixed rate loan and pay 7.375% on a new first. How convenient for them, they can earn 10% on the new money while they put the line of credit commitment to their loss reserve fund. What a shister trick! Pull everybody’s credit lines and then screw all the people who need it for emergencies. Desperate times call for desperate measures. It seems that WaMu is very close to going under.
I’m thinking I’ll offer to payoff my first loan at 10% discount and see what they say.
The moral of the story, get your line of credit in cash now if you are planning to use it in the near future. Rumor has it the the credit lines are going the way of the dinosaurs.
All is well and bye for now
A sign in front of WaMu
1 comment:
I don't know how I missed this post, but I think you're right. I think the financial market is only going to spiral from here.
I've been wishing Ron and I had our auto loans paid off as I expect they'll be the next hit in the loan market.
I know our house isn't much to look at, but it at least, is ours. That's something I suppose.
I really feel for all the people getting caught in the housing crunch.
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