Up until the recent slowdown, homeowners in many parts of the country saw the value of their homes rise rapidly. Home prices, in many areas, seemed to move in just one direction: up. A combination of record-low interest rates and rapid price appreciation turned many homeowners into serial refinancers. When interest rates dropped, one mortgage was exchanged for another, sometimes several times within one year. As home values rose, cash-out refinances allowed homeowners to pull equity out of their homes to remodel, send children to college, take vacations and buy new cars. It was good for the economy while wiping out billions of dollars of homeowner equity. Tapping into home equity seemed like a great idea until the housing market softened. Now there are millions of homeowners aro...
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