I really don’t think this is news...

Homeowners started losing hold of their homes years before spiking foreclosures and the housing slump slammed the economy.

Piece by piece, some gave away their homes by tapping equity to take cash out to pay for cars, weddings and vacations. Others never owned one brick. During the country’s most recent housing boom, the term “homeowner” became a misnomer as lenders offered 100 percent or more home financing to some buyers.

Now, slipping home prices threaten to further erode the value of many Americans’ single largest asset, curbing consumer spending and jeopardizing retirement assets.

It was clear a couple years ago that people didn’t have any actual equity in their homes.

Four years ago, our neighbor moved in, paying about $165,000 for his house. Two years later he got a home equity loan for $50,000 so he could finish off the basement. I knew there was something wrong at the time, because there is no way to build $50,000 in equity in two years on a 100% loan at 7% interest. My suspicions were correct when he moved out this past year.

Oh, it sure would have been nice to take a home quity loan to do some things around here, but I am glad now that I didn’t, that’s for sure. The only problem I face now is being the only house on my street that isn;t in danger of being foreclosed. So much for the appreciation of my most valuable asset.

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