09.21.26 HELOCked Into A Debt Trap / New Vehicles Under $40,000

Right now I wanna talk about something that is a plague upon us, and it's like we turned the clock back 20 years.

Because 20 years ago, the banks were pushing home equity lines everywhere you turned, TV ads, billboards, statements, mailers in them, saying, "Tap your home equity.

Take a vacation.

Buy a boat.

Buy a car.

Pay off your credit cards," whatever.

The whole thing was the banks were trying to get you to eat up the equity in your home so you would be on the hook to them for that home equity you've given up to them by taking out the HELOC.

So here we are 20 years later.

Everywhere you turn, online, you name it, the banks are trying the same con again, getting you to take a good thing and turn it into a bad thing, pushing you to take that equity.

If, you know, if you were lucky enough to buy a home during a time before the big price run-up that started during COVID in home prices, and you're sitting there pretty.

You got a low mortgage interest rate.

You don't owe a huge amount of money.

Your home has escalated in value, and the banks are trying to play on your mind and emotions, that this is your piggy bank, your money.

Grab it.

Take it.

Use it for whatever.

That's dangerous because you take this equity, this hard-earned equity that you have built up, and you reverse it into debt at today's interest rates, which are much higher.

And then you gotta pay it back, right? And then suddenly you got a much higher payment.

And when you go to sell your home, you don't get the proceeds you would've gotten before 'cause now you added all this extra debt onto it.

And everywhere you turn, I'm telling you, everywhere, the banks are trying to con you into taking out these HELOCs.

And you know why they love them so much? 'Cause it's a floating rate, and they set up the payments that you're never paying off the principal, that you're only paying them revolving interest, paying them the interest payments on it.

And every time interest rates go up, they, within a month, have raised what you have to pay on it.

It's a curse.

You had a blessing.

You got all this equity, and they turn around and say, "Take that vacation.