| Ready To Consolidate That Debt?
IF YOU'RE A homeowner saddled with debt (and we're talking about bad, high-interest debt like the kind you pile up on credit cards) then Alan Greenspan has offered you an escape route. How so? Well, while credit-card interest rates have become increasingly immune to Fed rate cuts (with the average fixed-rate credit card now charging 13.5%), home-equity lines of credit, or HELOCs, have fallen below 4.0%. That's one of the lowest rates we've seen since these products first became popular back in the mid-1980s. And better yet, that rate is before you consider the tax break on your interest payments. Indeed, from a pure number-crunching perspective, consolidating high-interest, nondeductible debt into a HELOC or a home-equity loan, or HEL, is a no-brainer. Of course, your home is the collateral for such a loan, and foreclosure could leave you bunking down in Mom's den.
The 90-Grand Phone Call
In early July, Joel Albert headed to his local Staples in Potomac, Md., to buy a paper shredder. The retired broadcast journalist opted for the cheapest model he could find -- one that accommodated just five documents at a time and cost less than $30. His purchase was a small gesture toward trying to establish some measure of security for his finances -- giving him and his wife just a little peace of mind in the aftermath of his role in the now widely publicized identity theft ordeal that unfolded just weeks before. Albert was one of the 30,000 victims of the largest identity theft racket in U.S. history. He was no small contributor to the culprits' total take of $3 million and counting. His contribution? Nearly 90 grand in equity he had built up in his Maryland home over the past 31 years.
Fannie label on Denver ominous
Metro Denver's designation as a "declining market" could delay any recovery in the area's long-suffering residential real-estate market, local housing experts said Tuesday. Some mortgage lenders are designating Denver and surrounding counties, excluding Boulder, as a market where prices are declining, upon instruction from Fannie Mae, which backed 41 percent of the nation's home mortgages in the third quarter. Fannie Mae is requiring a 5-percentage-point larger down payment on loans made in declining markets starting in the middle of next month. "When you look at it, it impacts everybody. If you want to sell your property, it becomes more difficult to do that," said Zachary Urban, director of housing counseling with Brothers Redevelopment. First-time buyers and others with minimal savings or equity for a down payment are likely to find themselves knocked out of the market.
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