Bank of America has adjusted Home Values on HELOC

Interestingly enough, I was getting ready to bail another bank out by buying a REO property.  In preperation I went to my BoA HELOC to pull some cash to finance the project when I learned that my Line was incredibly decreased due to a computer appriasal of my property.

Well, I’m not worried about the offer because my contracts have the financing clause built in and even though I was able to demonstrate that I had the money, that money has since disappeared.  But this causes some problems for my business and even for my family.

 I can appeal, but BoA will only consider the appeal, not actually do anything about it.  So now I’m off to update my business plan and try the SBA route to get cash for my projects.  But I ponder for a moment the implications to the economy that this change can cause.

 For example, if I already wrote the check (without checking first), would BoA honor the check and allow me over the new limit?

Well this help the economy or hurt it?  This will prevent people for over-extending on their real estate (we hope), but it also removes money from the consumers.  The biggest force in the economy (hence why the government is giving rebate checks to consumers and not business).

Now, also to learn that this is not public knowledge because the letters just went out on Monday, but I’m sure there will be a rush on the BoA call center for explaination and help as to what people can do.

Related posts:

1. Time for Armchairing the Economy
2. Let’s find a house and then talk to the bank….
3. Bank Owned versus New: A Buyer Observation