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As home values rise fast, homeowners are starting to realize they have a lot of wealth tucked into their homes, and it\u2019s become enticing to tap into it.<\/p>\n
\nRead more<\/strong>: Equity-Rich Properties Rise By 1.3M in 1 Year<\/span><\/p>\n<\/blockquote>\n
Since the housing<\/a> crash, homeowners have been shy about accessing any of their home equity, even those who still had money in their homes. But as millions of borrowers emerge from their underwater home loans<\/a> and see their home values jump again, they\u2019re turning to home equity lines of credit, or HELOCs, once again.<\/p>\n
HELOC volume has increased 21 percent over the past two years. It\u2019s now at the highest level since 2008, according to Moody\u2019s data. Still, it is far from the levels of the housing boom.<\/p>\n
“The more second liens that people take out, it adds a risk that comes from the rising home prices,\u201d says Peter McNally, a senior analyst at Moody\u2019s. \u201cThe fact that people are leveraging their homes more than before makes things more risky.\u201d<\/p>\n
Mixed with that, borrowers also are putting down smaller down payments. Prior to the last housing boom, the median down payment was just over 7 percent. Down payments dropped to 3 percent during the housing boom, but were back up to about 6 percent in 2016, according to ATTOM Data Solutions. Down payments are projected to move lower as more lenders<\/a> offer<\/a> greater low down payment options again.<\/p>\n
Source: \u201cMore Homeowners Cashing in on Their New Housing Wealth,\u201d CNBC (March 3, 2017)<\/em><\/p>\n<\/div>\n<\/div>\n
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