Frozen helocs

[Minna Reid]

So today I go to get some cash out of my heloc. Guess not! It seems citibank has decided my house isnt worth what it used to be and my heloc is now suspended. You'd think these people would have at least sent me a letter or something. Furthermore when I called they told me they decided my house has dropped 30% of its value in the last few months. Now I know theres a lot of gloom and doom being touted out there but thats just ridiculous. I know for a fact that my house has not dropped 30% and my local market is doing alright, but trying to fight the bank...well, I'm not feeling like taking on the aggravation right now.
However, it did get me thinking just how all this affects the marketplace. It seems a lot of banks are freezing helocs everywhere. That leaves people with even less cash and capital (and by surprise, no less), especially those of us who use helocs to further our business ventures. I really believe most of the hoopla is brought about and perpetuated by pure media frenzy. Now yes values have declined. The market did need a dose of reality, but the craziness that is being touted by all the media outlets, just scares people and further slows the economy. IMO, anyway.

Now the true cash buyers of the world....well I would guess those folks are sitting real pretty right now.