CHARLOTTESVILLE, Va. – Home equity loan outstandings continue to fall, and now have posted declines in every quarter since the end of 2008, according to analysis by SNL Financial.
As of June 30, aggregate home equity loans were at $689.98 billion, the firm said, down 22.85% from $894.35 billion at the end of 2008.
“Home equity loans have faced multiple headwinds, including the loss of home equity following the real estate collapse,” SNL said, “and the fact second-lien mortgages are less likely to have a meaningful recovery for creditors in the event a borrower defaults.”
Among SNL’s other findings:
• Average 10-year home equity loan rate came in at 5.66% annually, with 14 states averaging lower rates and 36 averaging higher rates.
• Maine led the nation with the lowest rate at 4.92%, New Mexico had the highest at 6.67%.
• At the same time home equity rates were decreasing, the incidence of delinquent home equity loans gained speed.
SNL’s analysis was based on regulatory findings by commercial banks, savings banks and savings institutions.
