Review Mortgage Lenders

Home Equity Loans

Home equity loans

Simple example of borrowing from equity to fuel consumption

Bubble Watch: Home-equity loans back at pre-recession levels

Buzz: Lenders are making home-equity loans at a pace last seen as the bubble was bursting a decade ago. This kind of lending — borrowing against the untapped value in a residence — can get dicey.

Source: Attom Data Solutions

Trend reported:  My trusty spreadsheet’s review of the Attom report shows 1.34 million U.S. equity loans were made in the 12 months ended in March , up 5.9 percent vs. the average pace of the previous three years. It’s the fastest lending activity since late 2008, loosely double from the post-recession low. But it’s also one-fifth the pace of the 2006-07 go-go years.

In Los Angeles and Orange counties, 48,409 equity loans were done in the past year, up 1.7 percent vs. the previous three years. Double the post-recession low but far-far-far saner than 505,000-a-year in 2006-07.

Riverside and San Bernardino counties saw 9,954 new equity loans in a year. That’s up 7.8 percent vs. previous three years and roughly triple the post-recession low. However, it’s not even close to the 2006-07 average of 150,000 equity loans.

Most borrowers request home equity loans for this reason

The study found that 42.9% of requests were for home improvement, topping the list of uses for home equity loans. Debt consolidation accounted for 38.2% requests, other reasons took up 9.3%, and other investment purposes were 7.8% of the requests.

Just over 1% of requests were to fund retirement. LendingTree found that the cohort had the highest average age of 63 — 12 years above the next highest average age. Meanwhile, 0.2% of requests were to access home equity for emergency expenses. The group had the lowest loan amount requested, $35,747.

Requests for investment property purposes accounted for 0.3% of the total. Additionally, LendingTree found that real estate investors borrow the most. Borrowers who were looking to invest in another property had the highest property values and requested loan amounts. For property investments, borrowers requested an average of $103,625. For non-property investments, which likely include small businesses, borrowers requested $80,241.

What to look for when shopping around for home equity loans?

Any advice on what to look for when shopping around for home equity loans?

Are there referral commissions?

I have a couple of individuals looking for a home equity loan ... I told them I'd look into it for them.

You have to have a mortgage license to collect a commission. It is not legal to be involved without a license.