Big Shitpile-a-Go-Go

Equity Loans as Next Round in Credit Crisis:

Little by little, millions of Americans surrendered equity in their homes in recent years. Lulled by good times, they borrowed — sometimes heavily — against the roofs over their heads.

Now the bill is coming due. As the housing market spirals downward, home equity loans, which turn home sweet home into cash sweet cash, are becoming the next flash point in the mortgage crisis.

Americans owe a staggering $1.1 trillion on home equity loans — and banks are increasingly worried they may not get some of that money back.

$1.1 trillion?! Cheesus.

And good luck getting out from under the debt by shifting it, selling the house, or, oh I dunno, moving to another city for a job where you can make more money, since many lenders, in an attempt to make sure they get that money back, "are taking the extraordinary step of preventing some people from selling their homes or refinancing their mortgages unless they pay off all or part of their home equity loans first."

Clusterfucktastrope, party of 300 million, your table is ready.

(Btw, I really loathe the framing of these stories as "Party's over; time to settle with the pub!" The economy has sucked for a very long time for a whole lot of people in the vast middle of this land of milk and honey, and lots of those home equity loans were certainly a necessity, not a bit of whimsy to pay for a top shelf holiday to Olde Europa, for Maude's sake.)

[H/T John Cole.]