Dagger in the Heart of the Remodeling Industry

I hate to have to write this: But I really think it's about time to contact the Federal Reserve and Ben Bernanke to tell him what's going on underneath the brouhaha about sub-prime lending.

It's awful enough that hundreds of thousands of homeowners are losing their homes and the greedy lenders are dropping into bankruptcy like flies.

Worse yet is the impact this debacle is having on homeowners who are securely ensconced in their homes, have a goodly amount of equity, and are able to pay their mortgages with ease.

These are the people who are my clientele. Not the wealthy, but the middle class homeowners who formed the bedrock of our economy...until now.

They have kept the economy going, ever since the horror of 9/11, by spending their money on making their nests as comfortable as possible. The trend spotters call it cocooning.

In the process they have funded the livelihoods of contractors, architects, designers, suppliers, like Home Depot and lumber yards, appliance manufacturers and stores, cabinet makers and dealers...on and on.

Most of this economic activity has been funded, not from savings, but from home equity loans.

Now, as a result of the sub-prime debacle, there are no funds available for home equity loans for anyone with the eensiest stain on their credit record...as much as 9 years and 364 days ago.
And even those with impeccable credit are finding loans to be less affordable and harder to come by at all.

And, now that the wealthy with their pocketed tax cuts are driving the economy, nobody is even noticing that the trillion dollar remodeling industry is grinding to a HALT!

If this doesn't scare you enough, have a look at Kathleen Pender's 7/31 column in the San Francisco Chronicle, Expect more woes with prime home-equity loans.

And, I suggest, if you are contemplating financing YOUR planned remodel with an equity loan; you may want to check into the availability of same before you spend any dollars.

Peggy