“If I owe you a pound, I have a problem; but if I owe you a million, the problem is yours.”

- John Maynard Keynes

News, tips, and freebies to help you use your home equity wisely:

Do Credit Unions provide better loan deals?

There’s been a battle raging for awhile now between banks and credit unions.  In a nutshell, banks feel that credit unions receive unfair tax advantages allowing them to offer below market rates on many types of loans including HELOCs.  The battle has heated up as CU’s have aggressively moved to expand their membership.  But regardless of the philosophical merits of the argument, we’ve long held that borrowers can often find the best HELOC deals at a credit union.  Recently, the Wall Street Journal published an article saying the same.  Read more here.  Compare bank and credit union HELOC rates here.

Free Reverse Mortgage Guide

A free 16-page reverse mortgage guide (”Is a Reverse Mortgage Right for Me?”) is available for download at www.reverse-mortgage-information.org.  Reverse mortgages are still relatively obscure home equity tools, but are rapidly gaining in popularity as baby boomers reach retirement age.  These tools allow senior citizens (age 62 and up) to borrow against the equity in their homes and not have to worry about loan repayment until the house is sold.  Record numbers of reverse mortgages have been originated in recent months.  In the right situations reverse mortgages can be wonderful tools….but in the wrong circumstances, they can be a very costly mistake.  Learn more….

Reverse Mortgage Books

With growing popularity of reverse mortgages, a number of books have been published on the subject in recent months.  We’ve taken a look at four of these books:

   

If you’re thinking about picking up one of thes books, check out our comments and recommendations  here….  Or, if you’ve read one of these books, feel free to leave your comments.

HELOC Rewards

The Wall Street Journal reports that rising rates and slacking demand for home equity loans and HELOCs is causing lenders to offer rewards both to retain customers and to attract new borrowers.  Lower rates for long-term customers, gift cards, and even reward “points” for HELOC debit card users are among the rewards being offered.  Read more…  If you’ve come across any particularly innovative or attractive deals, please let us know (email: heloc@sagetips.com).

The Role of Home Equity in Funding Retirement

It is well documented that the largest single asset for retirees and baby boomers nearing retirement is the home equity they’ve been able to build up over the course of the last several years’ rising home values.  But the question remains whether this asset will be enough to help secure their retirement needs in the face of dwindling corporate pensions and inadequate personal savings.  An interesting study from the Center for Retirement Research at Boston College suggest the answer is no:

“The central finding that emerges from this series of briefs exploring actual replacement rates that people have as they enter retirement is that regardless of how retirement income and pre-retirement income are defined, households with pensions are in good shape, and this group represents about two-thirds of all households. But one-third of households do not
have pensions and do not fare well, even after taking housing into consideration.”

More….

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