New York Renovator

I’m a tweener right now. Probably most of us in the Northern Hemisphere are! A “tweener” is what I call a person who is stuck between one weather season going out and another struggling to get in. In other words– we’ve reached the end of our tolerance for one season, and are eager to get into the next! While I like the snow and even the cold, I am sick of the ice and ice dams. Yet, I am torn, because I am one of the very rare people who dislike spring. Spring is wet, soggy, damp, cold, muddy. I am chilled more in spring weather then I am in the winter! I think it’s because spring is so clammy and damp. I dislike it. So I’m a tweener. Ready to see the winter go, but not really eager to see muddy spring come. Hmmm….

So far, spring is nowhere in sight...

In other news, we got approved for a home equity loan! HURRAY! I used credit cards and cash for the renovation expenses last summer. The cards had good promotional rates, which have now ended. So we applied for a loan and got approved. I like the scheduled payments, I like the routine. I’m praying with all my heart that we can get this loan paid off very soon, because we have the entire UPSTAIRS of the house to do yet!! Then, we tackle the exterior– we’ll need a new roof, new siding…. *sigh*

I am relatively new to home equity loans. Any kind of loan, especially on my beloved home, makes me nervous. Unfortunately, we don’t qualify for any VA Mortgage Loan or Streamline Refinance Program (that I am aware of, anyway). One of my out-of-state relatives raved about his Virginia VA Home Loan, but not for us. Oh well. It’s all out of pocket, all on our own. It is a REALLY gratifying feeling, though, to see your home’s value skyrocket because you sweated it out one summer. I am so proud of my kids, who helped with our renovations– thanks to our persistent work, we increased the value of our home AND “earned” money enough to refinance everything with a little extra, too. No wonder it’s called sweat equity! I am so thankful for my kids. I couldn’t have done this without them. And now, of course, comes the paying it all off!!! Which reminds me, I better get back to work….

Interesting news from Bloomberg this morning: the second-largest U.S. securities firm is tightening the home-equity belt.

Morgan Stanley, the second-biggest U.S. securities firm, told thousands of clients this week that they won’t be allowed to withdraw money on their home-equity credit lines, said a person familiar with the situation.

Most of the clients had properties that have lost value, according to the person, who declined to be identified because the information isn’t public. The New York-based investment bank will review home-equity lines of credit, or HELOCs, monthly from now on, the person said yesterday.

I’ve never liked the idea of a home-equity line of credit. It’s risky for investors and it is incredibly risky for home-owners. It’s far too easy to spend into the indebted obscurity of a black hole. I would never, never, never get a line of credit for this house– it would gobble up every dollar and then demand blood. It is essential to have a budget and stick to it.

But this move by Morgan Stanley sends shivers up my spine. They are being secretive about their losses, but speculative estimates are upwards into the billions, most of which is unrecoverable.

The president and his cronies can toss flower petals all day, and say that the economy is “good” or “recovering.” But when you see the biggest and riskiest of banks and firms closing their doors and shutting down lending systems, it evokes bells and whistles that things are going down for a while. I’m as optimistic as any one, but it would be plain dumb to pretend that nothing is wrong and to keep spending, spending, spending like drunken sailors. Why oh why is our government the first to create the problem and the last to fix it?